Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 1 of 144

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 1 of 144
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DOWNEY BRAND LLP

WILLIAM R. WARNE (SBN 141280)
MICHAEL J. THOMAS (SBN 172326)
ANNIE S. AMARAL (SBN 238189)
MEGHAN M. BAKER (SBN 243765)
621 Capitol Mall, 18th Floor
Sacramento, CA 95814-4731
Telephone: (916) 444-1000
Facsimile: (916) 444-2100
bwarne@downeybrand.com
mthomas@downeybrand.com
aamaral@downeybrand.com
mbaker@downeybrand.com
MATHENY SEARS LINKERT & JAIME, LLP

RICHARD S. LINKERT (SBN 88756)
JULIA M. REEVES (SBN 241198)
3638 American River Drive
Sacramento, CA 95864
Telephone: (916) 978-3434
Facsimile: (916) 978-3430
BRACEWELL & GIULIANI LLP

RICHARD W. BECKLER
D.C. Bar No. 262246
(Admitted Pro Hac Vice)
JENNIFER T. LIAS
Virginia Bar No. 85608
(Admitted Pro Hac Vice)
2000 K Street NW, Suite 500
Washington, DC 20006-1809
Telephone: (202) 828-5874
Facsimile: (800) 404-3970
richard.beckler@bgllp.com
jennifer.lias@bgllp.com
RUSHFORD & BONOTTO, LLP

PHILLIP R. BONOTTO (SBN 109257)
DEREK VANDEVIVER (SBN 227902)
1010 Hurley Way, Suite 410
Sacramento, CA 95825
Telephone: (916) 565-0590
Attorneys For Defendants W.M. BEATY &

ASSOCIATES, INC. AND ANN MCKEEVER
HATCH, as Trustee of the Hatch 1987
Revocable Trust, et al.
Attorneys for Defendant, EUNICE E.

HOWELL, INDIVIDUALLY and d/b/a
HOWELLS FOREST HARVESTING
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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UNITED STATES OF AMERICA,
Case No. 2:09-CV-02445-WBS-AC
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Plaintiff,
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SIERRA PACIFIC INDUSTRIES, W.M.

BEATY AND ASSOCIATES, INC.,
EUNICE E. HOWELL, INDIVIDUALLY
AND DOING BUSINESS AS HOWELLS
FOREST HARVESTING COMPANY;
ANN McKEEVER HATCH, AS TRUSTEE
OF THE HATCH 1987 REVOCABLE
TRUST, ET AL.
DEFENDANTS REVISED
SUPPLEMENTAL BRIEFING
REGARDING THE MOONLIGHT
PROSECUTORS FRAUD ON THE
COURT
Date: April 6, 2015
Time: 2:00 p.m.
Dept: Courtroom 5
Judge: Hon. William B. Shubb
Defendants.
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DEFENDANTS REVISED SUPPLEMENTAL BRIEFING REGARDING FRAUD ON THE COURT
TABLE OF CONTENTS
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I.
INTRODUCTION .......................................................................................................... 2
II.
WHAT DEFENDANTS MUST PROVE TO SEEK RELIEF UNDER RULE

60(D)(3). ......................................................................................................................... 5
A.
The Test for Fraud On the Court Within the Meaning of Rule 60(d)(3) ................ 5
B.
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III.
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Examples of Litigation Misconduct Which Have Been Held to Constitute

Fraud on the Court ............................................................................................... 7
1.
Hazel-Atlas Glass Company v. Hartford-Empire Company ...................... 7
United States v. Shaffer Equipment Company .......................................... 9
Pumphrey v. K.W. Thompson Tool Company ........................................ 11
4.
In re Levander ........................................................................................ 13
5.
Derzack v. County of Allegheny, Pennsylvania ...................................... 14
6.
Fraud Upon the Court May Arise From a Course of Conduct ................. 15
C.
A Motion or Action For Fraud on the Court is Not Precluded By Passage of
Time or Settlement ............................................................................................ 16
D.
The Integrity of the Judicial Process is Most Severely Damaged When
Government Actors Defraud the Court............................................................... 19
1.
Because They Represent the Sovereign, Government Attorneys Are
Held to a Higher Standard ...................................................................... 19
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Recklessness by a Government Attorney is Sufficient to Constitute
a Fraud Upon the Court .......................................................................... 24
EACH INSTANCE OF THE MOONLIGHT PROSECUTORS MISCONDUCT
CONSTITUTES A SEPARATE FRAUD ON THE COURT......................................... 25
A.
Background Facts Relevant to All Instances of the Moonlight Prosecutors
Misconduct. ....................................................................................................... 26
1.
A Brief Overview of the Moonlight Fire................................................. 26
2.
The Moonlight Fire Investigation, as Told Through the Joint Report ...... 28
3.
The Initiation of the State Actions .......................................................... 30
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The Initiation of the Federal Action ........................................................ 31
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The Resolution of the Federal Action ..................................................... 33
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Resolution of the State Court Action ...................................................... 37
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Wright and His Experiences Relating to the Moonlight Fire and
Other Wildfire Cases in the Year He Filed the Moonlight Action ........... 39
8.
Assistant United States Attorney Eric Overby ........................................ 41
9.
Filing With The Office of Professional Responsibility............................ 42
B.
Selected Instances of Prosecutorial Misconduct, Each of Which Separately
Constitutes Fraud on the Court........................................................................... 42
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The Moonlight Prosecutors Advanced a Fraudulent Origin and

Cause Investigation in the Litigation and Allowed the Investigators
to Repeatedly Lie under Oath about the Very Foundation of Their
Work, Thereby Committing a Fraud Upon the Court .............................. 43
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What Transpired on the Hillside on September 4-5, 2007 ........... 44

The Moonlight Investigators Are Confronted in Deposition
with Evidence of Their Secret Origin .......................................... 52
The Moonlight Prosecutors Affirmatively Assisted and

Encouraged the Moonlight Investigators False Testimony ......... 56
The Moonlight Prosecutors Misrepresented to the Court Bushs
Alleged Admission That a Rock Strike Caused the Moonlight
Fire, Which They Relied Upon in Procuring a Favorable Summary
Judgment Ruling, Thereby Committing a Fraud Upon the Court ............ 60
The Moonlight Prosecutors Proffered False Testimony in
Opposition to Defendants Motion for Summary Judgment and
Succeeded in Procuring a Favorable Ruling, Thereby Committing a
Fraud Upon the Court............................................................................. 65
The Moonlight Prosecutors Failed to Take Remedial Action After
Learning of Evidence that Undermined the Governments Origin
and Cause Conclusions and Failed to Produce Related Exculpatory
Evidence, Thereby Committing a Fraud Upon the Court ........................ 71
The Moonlight Prosecutors Created a False Diagram to Further
Their Case, Thereby Committing a Fraud Upon the Court ...................... 76
The Moonlight Prosecutors Failed to Disclose and Correct
Admittedly False Expert Reports Thereby Committing a Fraud
Upon the Court....................................................................................... 78
The Moonlight Prosecutors Misrepresented Evidence to the Court
to Wrongfully Claim that Howell Started Other Wildland Fires to
Procure Another Favorable Ruling on Summary Judgment, Thereby
Committing a Fraud Upon the Court ...................................................... 82
The Moonlight Prosecutors Actively Covered Up Misconduct at the
Red Rock Lookout Tower in Verified Discovery Responses and
Misrepresented the State of the Evidence to the Court, Thereby
Committing A Fraud Upon the Court ..................................................... 90
a.
What actually happened in the Red Rock Lookout Tower ........... 92
b.
The Cover-Up: What the Investigators and the Moonlight
Prosecutors said about what happened at the Red Rock
Lookout Tower ........................................................................... 94
c.
The lead Moonlight Prosecutor Taylor joined in the effort to
cover up what actually occurred at the Red Rock Lookout
Tower ......................................................................................... 98
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The Moonlight Prosecutors Made Reckless Misrepresentations

About Cal Fires Civil Cost Recovery Program to Procure Another
Favorable Pretrial Ruling on a Material Issue, Thereby Committing
a Fraud Upon the Court ........................................................................ 107
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The Moonlight Prosecutors Misrepresentations to the Court

Concerning WiFITER Constituted a Fraud Upon the Court ...... 117
Concealment of the Motivational Bias Created by WiFITER
Constituted a Fraud Upon the Court .......................................... 118
IV.
V.
The Existence of WiFITER Constitutes a Fraud Upon the

Court ........................................................................................ 120
10.
The Moonlight Prosecutors Concealed from the Court and
Defendants Percipient Witness Edwin Bauers False Report of a
Two Million Dollar Bribe, Which Enabled Them to Obtain a
Favorable Pretrial Ruling on a Material Issue, Thereby Committing
a Fraud on the Court............................................................................. 122
THE MOONLIGHT PROSECUTORS MULTIPLE INSTANCES OF
MISCONDUCT COLLECTIVELY CONSTITUTE FRAUD ON THE COURT ......... 131
CONCLUSION ........................................................................................................... 135
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TABLE OF AUTHORITIES
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CASES
Alexander v. Robertson,
882 F.2d 421 (9th Cir. 1989) ................................................................................................. 6
Aoude v. Mobil Oil Corp.,
892 F.2d 1115 (1st Cir. 1989).............................................................................................. 18
Benn v. Lambert,
283 F.3d 1040 (9th Cir. 2002) ............................................................................................... 3
Black v. Suzuki Motor Corporation,
No. 2:04-CV-180, 2008 WL 2278663 (E.D. Tenn. May 30, 2008) ...................................... 18
Brady v. Maryland,
373 U.S. 83 (1947) ........................................................................ 20, 21, 22, 24, 52, 119, 131
Broyhill Furniture Industries Inc. v. Craftmaster Furniture Corporation,
12 F.3d 1080 (Fed. Cir. 1993) .............................................................................................. 17
Cal Fire v. Dustin White (Lassen County Superior Court Case No. 4365 .................................. 47
Campbell v. United States,
365 U.S. 85 (1961) .............................................................................................................. 21
Chambers v. NASCO, Inc.,
501 U.S. 32 (1991) ................................................................................................... 5, 11, 130
Demjanjuk v. Petrovsky, a Sixth Circuit,
10 F.3d 338 (6th Cir. 1993) ....................................................... 20, 24, 25, 100, 117, 131, 135
Derzack v. Cnty. of Allegheny Children & Youth Servs.,
118 F.3d 1575 (3d Cir. 1997) .............................................................................................. 14
Derzack v. Cnty. of Allegheny, Pa.,
173 F.R.D. 400 (W.D. Pa. 1996) ............................................................ 14, 77, 105, 106, 120
Dixon v. C.I.R.,
316 F.3d 1041 (9th Cir. 2003) ....................................................... 6, 22, 60, 89, 104, 105, 135
EEOC v. Los Alamos Constructors, Inc.,
382 F. Supp. 1373 (D.N.M. 1974) ....................................................................................... 21
England v. Doyle,
281 F.2d 304 (9th Cir. 1960) ................................................................................................. 6
Freeport-McMoRan Oil & Gas Co. v. F.E.R.C.,
962 F.2d 45 (D.C. Cir. 1992)............................................................................................... 19
Hazel-Atlas Glass Co. v. Hartford-Empire Co.,
322 U.S. 238 (1944) ................... 5, 6, 7, 8, 9, 11, 16, 17, 18, 19, 22, 58, 63, 64, 69, 70, 74, 77,
................................................................................................................... 104, 131, 132, 135
Hennon v. Cooper,
109 F.3d 330 (7th Cir. 1997) ......................................................................................... 22, 23
Herring v. United States,
424 F.3d 384 (3d Cir. 2005) ................................................................................................ 17
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Imbler v. Pachtman,
424 U.S. 409 (1976) ............................................................................................................ 22
In re Intermagnetics Am., Inc.,

926 F.2d 912 (9th Cir. 1991) ................................................................ 6, 13, 15, 89, 104, 120
In re Levander,
180 F.3d 1114 (9th Cir. 1999) ...................................................................... 5, 13, 14, 15, 131
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Islamic Shura Council of S. Cal. v. F.B.I.,

779 F. Supp. 2d 1114 (C.D. Cal. 2011)................................................................................ 23
Kyles v. Whitley,
514 U.S. 419 (1995) .................................................................................................... 22, 119
Miranda v. Arizona,
384 U.S. 436, 483 n.54 (1966) .............................................................................................. 3
Morris v. Ylst,
447 F.3d 735 (9th Cir. 2006) ............................................................................................... 21
N. Mariana Islands v. Bowie,
243 F.3d 1109 (9th Cir. 2001) ............................................................................................. 21
Pumphrey v. K.W. Thompson Tool Co.,
62 F.3d 1128 (9th Cir. 1995) ............................. 5, 6, 11, 12, 13, 15, 17, 19, 22, 64, 65, 75, 81,
............................................................................................ 105, 106, 118, 120, 130, 131, 132
Southerland v. Irons,
628 F.2d 978 (6th Cir. 1980) ............................................................................................... 18
Southerland v. Oakland County,
77 F.R.D. 727 (E.D. Mich. 1978) ........................................................................................ 18
Sperry & Hutchinson Co. v. F.T.C.,
256 F. Supp. 136 (S.D.N.Y. 1966) ...................................................................................... 21
Standard Oil of Cal. v. United States,
429 U.S. 17 (1976) ................................................................................................................ 5
Stirone v. United States,
361 U.S. 212 (1960) ............................................................................................................ 22
Tennison v. City and County of San Francisco,
570 F.3d 1078 (9th Cir. 2008) ................................................................................ 21, 22, 119
Tiverton Bd. of License Commrs v. Pastore,
469 U.S. 238 (1985) ............................................................................................................ 88
Ty Inc. v. Softbellys, Inc.,
517 F.3d 494 (7th Cir. 2008) ............................................................................................. 107
United States v. Agurs,
427 U.S. 97 (1976) .............................................................................................................. 21
United States v. Bernal-Obeso,
989 F.2d 331 (9th Cir. 1993) ................................................................................................. 3
United States v. Blanco,
392 F.3d 382 (9th Cir. 2004) ....................................................................................... 22, 119
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United States v. Chu,

5 F.3d 1244 (9th Cir. 1993) ................................................................................................. 20
United States v. Estate of Stonehill,

660 F.3d 415 (9th Cir. 2011) .................. 5, 6, 15, 16, 23, 42, 58, 60, 64, 69, 78, 130, 132, 135
United States v. Maloney,
755 F.3d 1044 (9th Cir. 2014) ........................................................................................... 134
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United States v. Shaffer Equipment Company,

11 F.3d 450 (4th Cir. 1993) .............................. 9, 10, 11, 23, 24, 42, 69, 88, 89, 105, 117, 135
United States v. Young,
470 U.S. 1 (1985).......................................................................................................... 19, 23
Youngblood v. West Virginia, in,
547 U.S. 867 (2006) .................................................................................................... 22, 119
STATE COURT CASES
Hare v. McGue,
178 Cal. 740 (1918) .......................................................................................................... 121
Von Kesler v. Baker,
131 Cal. App. 654 (1933) .................................................................................................. 121
FEDERAL STATUTORY AUTHORITIES
18 U.S.C. section 1519, ....................................................................................................... 67, 91
18 U.S.C. 1001 ..................................................................................................................... 128
18 U.S.C. 1503 ..................................................................................................................... 91
18 U.S.C. 1512(c) ........................................................................................................... 52, 107
STATE STATUTORY AUTHORITIES
938.8 ................................................................................................................................. 34, 37
8002...............................................................................................................................109, 110
Cal. Health & Safety Code 13009 ......................................................................................... 109
Cal. Penal Code 424 .............................................................................................................. 115
FEDERAL RULES AND REGULATIONS
Fed. R. Civ. P. 26(e) ............................................................................................................ 63, 81
Fed. R. Civ. P. 26(e)(1)(A) ........................................................................................................ 80
Fed. R. Civ. P. 26(g)(1)(A) ........................................................................................................ 63
Fed. R. Civ. P. 60(b) .............................................................................................................. 5, 13
Fed. R. Civ. P. 60(c) .................................................................................................................. 16
Fed. R. Civ. P. 60(c)(1) .............................................................................................................. 16
Fed. R. Civ. P. 60(d)(3)................. 1, 4, 5, 11, 16, 17, 18, 24, 25, 26, 42, 58, 63, 64, 69, 74, 76, 78,
.................................................................................................. 81, 88, 89, 104, 106, 130, 131
Fed. R. Evid.403 ......................................................................................... 15, 126, 127, 130, 131
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STATE RULES AND REGULATIONS
Cal. R. Prof. Conduct 7-107(C)................................................................................. 118, 120, 121

Cal. Rule Prof. Conduct 5-120(A) .............................................................................................. 35
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Cal. Rule Prof. Conduct 5-120(C) .............................................................................................. 36

TREATISES
7 James Wm. Moore & J. Lucas, Moores Federal Practice (2d ed. 1978) ........................... 6, 120
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Pursuant to the Courts November 24, 2014, Order (Docket No. 618), Defendants Sierra
Pacific Industries (Sierra Pacific), W.M. Beaty and Associates, Inc. (W.M. Beaty), Eunice E.
Howell, individually and doing business as Howells Forest Harvesting Company (Howell);
and Ann McKeever Hatch, as Trustee of The Hatch 1987 Revocable Trust, et al.1 (collectively
Defendants), all of whom seek relief from this Court under Federal Rule of Civil Procedure2
60(d)(3), submit this focused briefing addressing the following issues as specified by the Court:
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(1) Identifying the test for fraud on the court under Rule 60(d)(3) and what Defendants
must prove to seek relief under that subsection;
(2) Assuming at this stage the truth of the Defendants allegations, assessing whether
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each alleged act of misconduct separately or collectively constitutes fraud on the court within
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the meaning of Rule 60(d)(3); and,
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(3) Explaining how and when Defendants discovered the alleged misconduct, specifically
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identifying whether Defendants learned of each alleged act before or after the settlement and
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dismissal of the case.
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In addition to Ms. Hatch, the named Landowner Defendants seeking relief under Rule 60(d)(3) also include Richard
L. Greene, As Trustee Of The Hatch Irrevocable Trust; Brooks Walker, Jr., As Trustee Of The Brooks Walker, Jr.
Revocable Trust And The Della Walker Van Loben Sels Trust For The Issue Of Brooks Walker, Jr.; Brooks Walker
III, Individually And As Trustee Of The Clayton Brooks Danielsen Trust, The Myles Walker Danielsen Trust, The
Margaret Charlotte Burlock Trust, And The Benjamin Walker Burlock Trust; Leslie Walker, Individually And As
Trustee Of The Brooks Thomas Walker Trust, The Susie Kate Walker Trust, And The Della Grace Walker Trust;
Wellington Smith Henderson, Jr., As Trustee Of The Henderson Revocable Trust; Elena D. Henderson; Mark W.
Henderson, As Trustee Of The Mark W. Henderson Revocable Trust; John C. Walker, Individually And As Trustee
Of The Della Walker Van Loben Sels Trust For The Issue Of John C. Walker; James A. Henderson; Charles C.
Henderson, As Trustee Of The Charles C. And Kirsten Henderson Revocable Trust; Joan H. Henderson; Jennifer
Walker, Individually And As Trustee Of The Emma Walker Silverman Trust And The Max Walker Silverman Trust;
Kirby Walker; And Lindsey Walker, A.K.A. Lindsey Walker-Silverman, Individually And As Trustee Of The Reilly
Hudson Keenan Trust And The Madison Flanders Keenan Trust (collectively, Landowners or Landowner
Defendants).
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All further references to Rule or Rules are to the Federal Rules of Civil Procedure unless otherwise stated.
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I. INTRODUCTION
The prosecutorial misconduct associated with the Moonlight Fire matter was not
comprised of mistakes on the periphery. It was not the consequence of episodic errors of
judgment. Instead, it was systematic, pervasive, and purposeful, with each act aimed at affecting
the administration of justice through the use of a thoroughly corrupt investigation designed to
frame these Defendants. As this misconduct marched towards its payoff, both investigators and
prosecutors were more than willing to carry and place their deceptions deep within the machinery
of this Courts legal processes. The numerous deceptions were not minor. They began at the
very heart of the underlying case against these Defendants and moved outward from there, ripples
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in a tainted pond ultimately touching every aspect of this case. In fact, the gross misconduct was
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so foreign to what one would expect from federal prosecutors that it ultimately caused Assistant
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United States Attorney Eric Overby, a senior and highly respected federal prosecutor on the
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Moonlight Fire prosecution team, to seek the company of one of Defendants counsel while he
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explained just why he was leaving the prosecution team. In fact, there is perhaps no better
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summary of why this case was so misdirected than the line Overby revealed that he delivered to
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his cohorts as he walked out the door: Its called the Department of Justice. Its not called the
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Department of Revenue.
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Overby was not alone in his disgust. On February 4, 2014, Judge Leslie C. Nichols, the
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only judge who has yet to review the legal record of the Moonlight Fire action, found by clear
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and convincing evidence that Cal Fires underlying origin and cause investigation was corrupt
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and tainted. The court also found that Cal Fire and its counsel who co-prosecuted this federal
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action with federal lawyers working for our Department of Justice engaged in a stratagem of
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obfuscation that infected virtually every aspect of discovery in this case. Judge Nichols found
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that their conduct was not only grossly unfair to these Defendants, but an attack on the court and
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our system of justice. In this regard, Judge Nichols specifically held, [t]he cost of Plaintiff Cal
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Fires conduct is too much for the administration of justice to bear, and his honor further held
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that the repeated and egregious violations of the discovery laws not only impaired Defendants
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rights, but have threatened the integrity of the judicial process.

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In pointedly addressing the prosecution of the matter, Judge Nichols rebuked the Deputy
Attorneys General representing Cal Fire, stating, [t]he sense of disappointment and distress
conveyed by the Court is so palpable, because it recalls no instance in experience over forty seven
years as an advocate and as a judge, in which the conduct of the Attorney General so thoroughly
departed from the high standard it represents, and, in every other instance, has exemplified. In a
separate order, Judge Nichols found:
In all matters, the Court maintains the ability to adjudicate the

conduct of all parties and their counsel, be they public or private,
in order to protect the integrity of the court. Finding otherwise
would do grave damage to the integrity of the judicial process and
the publics confidence in it, especially for those who find
themselves defendants in actions brought by a public agency that
perceives itself immune from the courts oversight and control.
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For these reasons and more, Judge Nichols terminated Cal Fires cost recovery action and
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awarded Defendants more than $30 million in discovery abuse sanctions.
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The Moonlight Fire investigation, however, was not just carried out by two public
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agencies, one state and one federal. It was jointly conducted by their own law enforcement
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officers, public servants duty-bound to discover and report the truth regarding what caused this
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massive forest fire. 3 Conducting an honest investigation was not only the Moonlight
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Investigators sworn obligation, it was of course critical to the furtherance of justice. As noted by
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our Supreme Court, we can have the Constitution, the best laws in the land, and the most honest
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reviews by courts but unless the law enforcement profession is steeped in the democratic
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tradition, maintains the highest in ethics, and makes its work a career of honor, civil liberties will
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continually and without end be violated. Miranda v. Arizona, 384 U.S. 436, 483 n.54 (1966)
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(quoting Hoover, Civil Liberties and Law Enforcement: The Role of the FBI, 37 Iowa L. Rev.
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175, 177-82 (1952)). Similarly, the Ninth Circuit expects prosecutors and investigators to take
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all reasonable measures to safeguard the system against treachery. Benn v. Lambert, 283 F.3d
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1040, 1062 (9th Cir. 2002) (quoting United States v. Bernal-Obeso, 989 F.2d 331, 334 (9th Cir.
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1993)).
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These investigators are referred to throughout this brief as the Moonlight Investigators.
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With respect to wildland fires, the integrity of the investigators is especially essential
because they have exclusive access to the scene, because the area of origin is perishable and
easily spoiled, and because their findings generally have a profound impact on whoever is held
responsible. The written report of their investigation the origin and cause report is equally
critical. Properly completed, it exists to provide a window into what the investigators found and
what they did as they scientifically and systematically worked toward their conclusions.
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All of these duties and promises were shattered here. The investigation was neither
scientific nor systematic. Indeed, it was corrupt and tainted. Instead of seeking the truth, the
Moonlight Investigators concealed it, or they simply manufactured it. Instead of advancing
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justice, they obstructed justice, a federal crime that carries a penalty of up to twenty years.
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Worse, federal prosecutors, charged with the solemn responsibility of protecting the truth, ignored
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their gatekeeper function in favor of assisting the investigators with their treachery. 4 When
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their star investigator witnesses repeatedly lied under oath, the Moonlight Prosecutors sat on
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their hands. When it became abundantly clear that the Moonlight Investigators core findings
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were the byproduct of a reprehensible effort to frame these Defendants, they pushed the case
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forward regardless, taking full advantage at every turn of the natural trust this Court placed in
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them as they sought a pay day for the United States. Consumed by their desire to win, they
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engaged in an unconscionable scheme by affirmatively advancing the Moonlight Investigators
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sham conclusion, by creating false interrogatory responses, by hiding information from these
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Defendants and the Court, by repeatedly breaching their duty of candor to the Court, by telling
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the investigators that they need not fret over what Defendants discovered about their secret point
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of origin, and by knowingly and recklessly submitting information to this Court that was blatantly
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false on key issues going to the heart of their case. Ignoring their solemn obligation to seek
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justice, the Moonlight Prosecutors instead did violence to their essential charter by permitting
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these investigators to obstruct justice, all in a misguided effort to obtain a win through
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The prosecutors of the federal action are referred to throughout this brief as the Moonlight Prosecutors. As
Defendants noted in their initial Rule 60(d)(3) brief, their focus regarding prosecutorial misconduct is on certain
prosecutors who worked on this case, not on the entire office. Defendants believe that most prosecutors are
hardworking and dedicated public servants who are properly focused on protecting the truth and advancing justice.
4
improperly influencing this Court. Uncomfortable as it is to recognize such conduct in
individuals whose very purpose is to advance justice, it must be recognized here and publically
dealt with in order to begin to repair the tremendous damage these particular prosecutors have
already done to this Court and to the integrity of our judicial system.
II. WHAT DEFENDANTS MUST PROVE TO SEEK RELIEF UNDER RULE 60(d)(3).5
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A.
Rule 60 of the Federal Rules of Civil Procedure, entitled Relief from a Judgment or
7
8
Order, provides that judgments, while ordinarily accorded a degree of finality, are subject to
being set aside when appropriate, whether for ministerial reasons at one end of the spectrum or
10
for fraud at the other. Fed. R. Civ. P. 60.

Rule 60(b), which is focused on fraud between parties, is governed by a one year statute
11
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The Test for Fraud On the Court Within the Meaning of Rule 60(d)(3).
12
of limitation. Rule 60(d), on the other hand the basis on this motion is focused on fraud on
13
the court and has no time bar whatsoever. Moreover, Rule 60(d) does not limit a courts power
14
to . . . set aside a judgment for fraud on the court, Fed. R. Civ. P. 60(d), as it simply codifies a
15
fundamental principle: federal courts have always had the inherent equity power to vacate
16
judgments obtained by fraud. United States v. Estate of Stonehill, 660 F.3d 415, 443 (9th Cir.
17
2011) (citing Chambers v. NASCO, Inc., 501 U.S. 32, 44 (1991); In re Levander, 180 F.3d 1114,
18
1118-19 (9th Cir. 1999)). As found by the Supreme Court, a federal courts power to vacate a
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judgment procured by fraud originates from a rule of equity that fulfill[s] a universally
20
recognized need for correcting injustices which, in certain circumstances, are deemed sufficiently
21
gross to demand a departure from rigid adherence to the rule that a final judgment is typically
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binding and final. Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238, 244 (1944),
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overruled on other grounds by Standard Oil of Cal. v. United States, 429 U.S. 17 (1976).
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In this portion of their focused briefing, Defendants outline the applicable test and controlling authority for
assessing whether a fraud on the court has occurred, i.e., what Defendants must prove in order to obtain relief.
However, Defendants acknowledge that the Court requested they explain what they must prove in order to seek
relief under Rule 60(d)(3). Because there is no case establishing a threshold burden that Defendants must satisfy to
proceed under Rule 60(d)(3), nor a threshold showing set forth in the rule itself, it appears that the only prerequisite
to seeking relief under Rule 60(d)(3) is that the complainant have been a party to the action in which the fraud on the
court occurred. Of course, it is beyond dispute that the Court itself also may initiate proceedings sua sponte if it
discovers conduct constituting a fraud upon the court. See Pumphrey v. K.W. Thompson Tool Co., 62 F.3d 1128,
1130 (9th Cir. 1995) (proceedings initiated from court learning of conduct constituting fraud on the court).
5
DOWNEY BRAND LLP
While courts have struggled to define the conduct that constitutes fraud on the court, the
Ninth Circuit confirms this particular species of fraud exists when the moving party demonstrates,
by clear and convincing evidence, that the opposing partys misconduct has harmed the
integrity of the judicial process . . . . Stonehill, 660 F.3d at 443-44 (quoting England v. Doyle,
281 F.2d 304, 310 (9th Cir. 1960) (evidentiary standard); Alexander v. Robertson, 882 F.2d 421,
424 (9th Cir. 1989) (standard for harm)); Dixon v. C.I.R., 316 F.3d 1041, 1046 (9th Cir. 2003).
[F]raud on the court . . . embrace[s] only that species of fraud which does[,] or attempts to, defile
the court itself, or is perpetrated by officers of the court so that the judicial machinery cannot
perform in the usual manner its impartial task of adjudging cases that are present for
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adjudication. In re Intermagnetics Am., Inc., 926 F.2d 912, 916 (9th Cir. 1991) (quoting 7
11
James Wm. Moore & J. Lucas, Moores Federal Practice 60.33 (2d ed. 1978)). When conduct
12
harms the integrity of the judicial process . . . and the fraud rises to the level of an
13
unconscionable plan or scheme which is designed to improperly influence the court in its
14
decisions, there has been a fraud on the court, and the court not only can act, [but] should.
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Dixon, 316 F.3d at 1046 (quoting England, 281 F.2d at 309).
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[T]he inquiry as to whether a judgment should be set aside for fraud upon the court . . .
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focuses not so much in terms of whether the alleged fraud prejudiced the opposing party . . . .6
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Intermagnetics, 926 F.2d at 917. Fraud on the court is a wrong against the institutions set up to
19
protect and safeguard the public, institutions in which fraud cannot complacently be tolerated
20
consistently with the good order of society. Pumphrey v. K.W. Thompson Tool Co., 62 F.3d
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1128, 1133 (9th Cir. 1995) (quoting Hazel-Atlas, 322 U.S. at 264). Thus, the question of whether
22
one party would have prevailed but for the opposing partys fraud on the court is decidedly not
23
the relevant inquiry. Id. at 1132. Instead, the question is whether the alleged fraud harms the
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integrity of the judicial process. Intermagnetics, 926 F.2d at 917. As discussed herein, and as
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could be shown through an evidentiary hearing, the jointly prosecuted Moonlight Fire action
26
6
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This rule does not mean, as the government states in the Joint Status Report, that [a]ccusations of conduct
prejudicial only to the defendants are irrelevant. (Docket No. 612 at 18.) Prejudice to Defendants may be entirely
relevant to determining whether the judicial machinery [could not] perform in the usual manner . . . .
Intermagnetics, 926 F.2d at 916.
6
worked an egregious fraud upon two courts, grievously damaging the integrity of our judicial
process.
B.
Examples of Litigation Misconduct Which Have Been Held to Constitute Fraud on

the Court.
DOWNEY BRAND LLP
Courts have held that a wide range of misconduct can constitute fraud on the court. The
fraud perpetrated upon this Court through the Moonlight Fire prosecution is multi-faceted and
pervasive, involving numerous, distinct types of misconduct, each one of which is sufficient to
cause the Court to now terminate the action and vacate the settlement. The fact that the
Moonlight Fire case serves as a veritable warehouse display of numerous types of misconduct
10
that, on their own, would be sufficient to terminate an action for fraud upon the court only
11
compounds the egregious quality of the fraud, as well as the need for this Court to use the full
12
weight of its inherent powers to address the conduct of the Moonlight Investigators and
13
Prosecutors.
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1.
Hazel-Atlas Glass Company v. Hartford-Empire Company
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In Hazel-Atlas, the Supreme Court found a fraud on the court when the plaintiff in the
16
underlying action, Hartford, presented manufactured evidence to the court in connection with a
17
merits-based decision. 322 U.S. at 245. Specifically, Hartford had a pending application for a
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patent, which the Patent Office opposed. Id. at 240. In support of the application, Hartfords
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attorneys and officials wrote a bogus article describing the device at issue as a remarkable
20
advance in the art and revolutionary. Id. Thereafter, the attorneys and officials procured the
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signature of a disinterested expert and had it published in a trade journal. Id. Hartford
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subsequently submitted the article in support of its pending patent application, which was
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ultimately granted. Id. at 240-41. Hartford then brought suit against Hazel-Atlas for patent
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infringement. Id. at 241. While the case was pending before the district court, Hazel-Atlas heard
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rumors concerning the articles fraudulent authorship, but did not defend the suit on those
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grounds. Id. The district court dismissed the case in any event, finding Hartford failed to show
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patent infringement. Id. Hartford appealed. Id.
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The Third Circuit reversed the district courts decision in favor of Hazel-Atlas, quoted the
7
fraudulent pro-Hartford article at length, and held that Hazel-Atlas had infringed Hartfords valid
patent. Id. at 241-42. While the deadline for Hazel-Atlass petition for rehearing of the appeal
was approaching, Hartford obtained a signed statement from the supposed author of the article,
stating that he had written the article. Id. at 242-43. Hazel-Atlas then capitulated and settled
the case. Id. at 241. It paid Hartford $1,000,000 and entered into certain licensing agreements.
Id. As a result of the settlement agreement, Hazel-Atlas did not file a petition for rehearing, and
the district court entered judgment against Hazel-Atlas in accordance with the Third Circuits
mandate. Id. at 253 (Roberts, J., dissenting). At the time the judgment was entered, Hazel-Atlas
was actively investigating whether the article was fraudulent. Id. at 242.
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Seven years later, when these facts fully came to light, Hazel-Atlas brought a motion to
11
vacate the judgment for fraud on the court. Id. at 243. Finding the story sordid, id., the
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Supreme Court stated: Every element of the fraud here disclosed demands the exercise of the
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historic power of equity to set aside fraudulently begotten judgments. This is not simply a case of
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a judgment obtained with the aid of a witness who, on the basis of after-discovered evidence, is
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believed possibly to have been guilty of perjury. Id. at 245. The Supreme Court also noted that
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even if it consider[ed] nothing but Hartfords sworn admissions, Hartfords conduct amounted
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to a deliberately planned and carefully executed scheme to defraud not only the Patent Office but
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the Circuit Court of Appeals. 7 Id.
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Importantly, the Supreme Court firmly rejected Hartfords argument that fraud on the
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court exists only where reliance on the fraudulent evidence was basic to the underlying
21
decision. Id. at 246-47. In this regard, the Supreme Court found it more than adequate that
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Hartfords officials and lawyers thought the article material. They conceived it in an effort to
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As discussed in more detail, infra, this case is similar to Hazel-Atlas in that the Moonlight Investigators conceived a
plan to manufacture a blatantly false official report of their investigation. Thereafter, the Moonlight Prosecutors
knowingly and recklessly advanced the Moonlight Investigators fraudulent report and their manufactured evidence
into this litigation and then allowed the Moonlight Investigators to lie about it repeatedly under oath, all in a carefully
executed scheme to not only defraud Defendants but the Court as well. As discussed infra, the Moonlight
Prosecutors submitted Whites false affidavit and the fraudulent origin and cause report in support of their opposition
to Defendants motion for summary judgment, just as the Hartford parties submitted the bogus article on their patent.
The fraudulent report was not only a work of fiction with respect to its key findings, but it also attached and relied
upon falsified official documents in the form of tampered witness statements and falsified origin and cause reports
regarding other fires.
8
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persuade a hostile Patent Office to grant their patent application, and went to considerable trouble
and expense to get it published. . . . [T]hey urged the article upon the Circuit Court and
prevailed. Id. at 247. The Court therefore concluded that Hartford was in no position now to
dispute its effectiveness. Id. Furthermore, the Court observed that, because it is wholly
impossible [to] accurately . . . appraise the influence that the article exerted on the judges, it
would not attempt to do so. Id.
The total effect of all this fraud . . . calls for nothing less than a complete denial of relief
to Hartford for the claimed infringement of the patent thereby procured and enforced. Id. at 250
(emphasis added). The Supreme Court specifically acknowledged that while Hazel-Atlas had
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been aware of at least the possibility of Hartfords fraud at the time of both the trial and appeal,
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every element of the fraud here disclosed demands the exercise of the historic power of equity to
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set aside fraudulently begotten judgments. Id. at 245. Hartford had tamper[ed] with the
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administration of justice, and thus committed a wrong against the institutions set up to protect
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and safeguard the public, institutions in which fraud cannot complacently be tolerated
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consistently with the good order of society. Id. at 246. The Supreme Courts decision in Hazel-
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Atlas provides the foundation for assessing what constitutes a fraud on the court and confirms the
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intolerance the judiciary must have for misconduct which defiles the court.
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2.
19
Of course, manufacturing evidence is not the only type of misconduct that can lead to a
United States v. Shaffer Equipment Company
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finding of fraud on the court. In United States v. Shaffer Equipment Company, 11 F.3d 450 (4th
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Cir. 1993), a government lawyers failure to comply with his duty of candor was found to be
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sufficient. Specifically, in Shaffer, government attorneys for the Environmental Protection
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Agency brought suit to recover the costs of an environmental cleanup but wrongfully failed to
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reveal to the court and the defendants that the EPAs on-scene cleanup coordinator, Caron, had
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misrepresented his academic credentials in that case and in prior cases. Id. at 452. The same
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government attorneys also wrongfully obstructed the defendants efforts to root out these
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discrepancies in Carons credentials. Id. Indeed, Caron had admitted to one of the government
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attorneys as early as September 1991 that he did not have a college degree, id. at 459, because
9
he had not complete[d] his class work for a degree from Rutgers and never attended any classes
at any . . . other schools, id. at 454. Instead of exposing this corruption, the government attorney
simply watched as Caron falsely testified in his deposition that he had completed all of the
requirements for a degree at Rutgers and the only reason he had not received his diploma was a
question of paperwork[,] and that he had continued taking courses at Drexel for a masters
degree. [Caron] stated that his bachelors degree work was in environmental science and his
masters degree work was in organic chemistry. Id. at 454.
DOWNEY BRAND LLP
At a later deposition, the government directed Caron not to answer any questions about his
resume in which Caron claimed to have received degrees from Rutgers and Drexel, claiming the
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inquiry was not relevant to the litigation. Id. This same government attorney researched the issue
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and concluded two days later that the coordinators credibility was relevant as a matter of law, but
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he did not supplement the governments response to an earlier interrogatory directed to Carons
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credentials (to which the government had objected on the basis of irrelevance) and did not
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withdraw the relevancy objection to the discovery . . . . Id. at 455. The government also failed
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to disclose to the court, and to defense counsel, that Caron was being investigated both criminally
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and by the EPA. Id. Despite these issues, the government continued to litigate the matter
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unabated without disclosing the investigations to the Court. Id. at 456. Another government
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attorney, a supervisor, involved in the case was aware not only of these facts, but also aware that
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Caron had testified falsely in another litigation. Id. This attorney, however, prevented these facts
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from being disclosed to defense counsel. Id. The government also relied on the administrative
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record made by Caron in moving for summary judgment.8 Id. at 460.
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As was the case in Shaffer, but on a far greater scale, the Moonlight Prosecutors, including their supervisor,
repeatedly breached their duty of candor to the Court, by aggressively defending the Moonlight Investigators
depositions and failing to inform the Court that they lied repeatedly while under oath about their secret point of origin
and their hidden white flag. The Moonlight Prosecutors also breached their duty of candor by submitting the
investigators fictional origin and cause report to the Court and failing to inform the Court that its most fundamental
findings were a fraud. They breached their duty of candor by failing to inform the Court that lead Moonlight
Investigator Joshua Whites declaration in opposition to Defendants motion for summary judgment was false, and by
failing to inform the Court that federal Moonlight Investigator Diane Welton engaged in witness tampering and
obstruction of justice by telling witnesses what they could and could not say and by manufacturing false interview
reports of these same witnesses. The Moonlight Prosecutors breached their duty of candor by themselves crafting
and allowing witnesses to sign blatantly false interrogatories regarding the Red Rock Lookout Tower, thereby
participating in and perpetuating this long-running federal cover-up, by failing to inform the Court that a third party
had lied to investigators about his whereabouts on the day of the fire, and by generally continuing to litigate this case
10
DOWNEY BRAND LLP
The court found that the issue of Carons credentials, capability, and credibility [were]
relevant to the examination of the administrative record, and the integrity of the administrative
record [was] relevant to central issues in the case. Id. The court observed that a general duty of
candor to the court exists in connection with an attorneys role as an officer of the court, and that
[o]ur adversary system for the resolution of disputes rests on the unshakable foundation that
truth is the object of the systems process which is designed for the purpose of dispensing
justice. Id. at 457. [L]awyers, who serve as officers of the court, have the first line task of
assuring the integrity of the process[,] id. at 457, and their duties to their client are trumped
ultimately by a duty to guard against the corruption that justice will be dispensed on an act of
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deceit, id. at 458. Citing to Chambers, 501 U.S. 32, the Fourth Circuit found that there is a
11
broader general duty of candor and good faith required of officers of the court to protect the
12
integrity of the entire judicial process. 11 F.3d at 458. The court cited to Hazel-Atlas for the
13
rule that there is general duty to preserve the integrity of the judicial process which the
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government attorneys in Shaffer violated. 11 F.3d at 458 (citing 322 U.S. 238). The court found
15
that, in repeatedly failing to advise the court of the Caron problem and the civil and criminal
16
investigations relating to it, and in continuing to litigate the matter unabated, the government
17
attorneys sufficiently undermine[d] the integrity of the judicial process and violated the
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general duty of candor that attorneys owe as officers of the court. Id. at 459. These actions were
19
sufficient to constitute a fraud on the court. 9 See id. at 461.
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3.
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The Ninth Circuits decision in Pumphrey, 62 F.3d 1128, is also instructive. Pumphrey
Pumphrey v. K.W. Thompson Tool Company
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unabated, despite knowing that the entire investigation was teeming with dishonesty and corruption. If there has ever
been a case where government lawyers grossly failed to carry out their responsibility to assure the integrity of the
process, it is this one. Here, the best that can be said is that the Moonlight Prosecutors did absolutely nothing to
guard against the corruption that justice will be dispensed on an act of deceit. 11 F.3d at 458. The worst that can be
said is that they affirmatively assisted in an effort to have justice dispensed based on numerous acts of deceit.
9
Notably, the Fourth Circuit did not rely solely on Rule 60(d)(3) in upholding the district courts decision to vacate
the judgment entered for the government. While the Fourth Circuit discussed fraud on the court and the Supreme
Courts decisions in Hazel-Atlas, the Fourth Circuit found its ability to vacate the judgment from its inherent power.
11 F.3d at 461. The court stated: [d]ue to the very nature of the court as an institution, it must and does have an
inherent power to impose order, respect, decorum, silence, and compliance with lawful mandates. This power is
organic, without need of a statute or rule for its definition, and it is necessary to the exercise of all other powers. Id.
11
involved a wrongful death action arising from an accidental shooting wherein the defendant gun
manufacturer participated in a scheme to defraud the Court by withholding evidence. The
primary issue in the case was whether a certain model of gun could accidentally fire when
dropped despite having one or both safeties engaged. Id. at 1133. While the case was pending
before the district court, the gun manufacturer videotaped drop tests involving the gun. Id. at
1131. During these tests, a company manager and its general counsel were present. Id. In the
original video, which the company withheld, the gun fired when dropped. Id. In the second
video, which the company produced, the gun did not fire when dropped. Id.
DOWNEY BRAND LLP
Before filming the videos, the company answered requests for production by stating it was
10
not aware of any records relating to handgun testing, but if records were later discovered the
11
company would make them available to the plaintiff. Id. During continued discovery, the
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company only produced the second video and, in answers to interrogatories, mischaracterized the
13
results and stated there was no record of a test showing that the gun had accidentally fired. Id. at
14
1132. The general counsel also never disclosed to the companys trial counsel the existence of
15
the original video or its results. Id. The general counsel then attended the trial and watched as
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the manager falsely testified that he had never seen the gun fire when dropped during tests.10 Id.
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The general counsel was also present at depositions in subsequent cases when the manager gave
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false testimony about whether engaging the guns safety affected whether the gun fired when
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dropped.11 Id.
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The general counsel neither suborned this perjury nor presented it to the court; he merely observed as the manager
perjured himself. 62 F.3d at 1132. The companys trial counsel who presented the testimony to the court did not
know that it was perjured. Id. at 1131. It was enough that the general counsel participated in the case, although he
did not enter an appearance in the litigation, was not admitted pro hac vice, and did not sign any documents filed with
the court. Id. at 1130-31. Thus, contrary to the Moonlight Prosecutors statement in the Joint Status Report, the law
is not that perjury can only be a fraud on the court if counsel committed or intentionally suborned the perjury and
presented it to the Court in an effort to influence its decision. (Docket No. 612 at 18.)
11
As discussed infra, this case presents facts similar to those of Pumphrey, in that the Moonlight Investigators and
Prosecutors routinely destroyed or concealed inconvenient facts. White, a law enforcement officer, destroyed his
own field notes even though he understood that litigation would result from his findings. The Moonlight Prosecutors
themselves failed to produce expert data that would have been harmful to their effort to pin blame on these
Defendants, and on information and belief, instructed their expert not to create an amended report, even after he
learned from Defendants expert that he had used the wrong data set. The Moonlight Prosecutors also attempted to
conceal what actually happened at the Red Rock Lookout Tower the day of the fire by drafting false interrogatory
responses which omitted the most important facts.
12
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The Ninth Circuit found that [b]y failing to disclose the original video, mischaracterizing
the results of the drop-tests, and failing to correct the false impression created by [the managers]
testimony, [the general counsel] undermined the judicial process.12 Id. at 1133. The court
examined whether the fraudulent misrepresentations went to the main issue of the case, or instead
went to immaterial and technical inaccuracies. Id. The court found that the general counsels
failure to abide by the [rules of discovery and professional responsibility] harmed the integrity
of the judicial process, and amounted to a fraud on the court committed by an officer of the court.
Id. Importantly, the Court specifically considered and rejected the argument that fraud could not
be found where the concealment of evidence did not affect the outcome of the case. In this
10
regard, the Ninth Circuit stated that the defendants argument misse[d] the point. Id. at 1133.
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The issue here is not whether [the plaintiff] would have prevailed had the original video been
12
produced. As we noted in Intermagnetics, the inquiry as to whether a judgment should be set
13
aside for fraud upon the court under Rule 60(b) focuses not so much in terms of whether the
14
alleged fraud prejudiced the opposing party but more in terms of whether the alleged fraud harms
15
the integrity of the judicial process. Id. (quoting Intermagnetics, 926 F.2d at 917).
16
4.
17
In Levander, the Ninth Circuit found fraud on the court where the court relied on perjured
In re Levander
18
testimony in issuing a decision. 180 F.3d at 1120. The Levanders were Chapter 11 bankruptcy
19
debtors who were awarded attorneys fees against a certain corporation. Id. at 1116. At the time
20
the attorneys fees were awarded, neither the debtors nor the bankruptcy court knew of the
21
existence of a partnership to which the corporation had transferred all of its assets. Id. at 1117.
22
The bankruptcy court therefore awarded the debtors attorneys fees and costs against the
23
corporation only. Id. The bankruptcy court and the Levanders were ignorant as to the existence
24
of the partnership because one of the corporations officers falsely testified at a deposition that the
25
corporation had not sold its assets and was still an active company. Id. Notably, the Ninth
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The Ninth Circuits focus on the defendants failure to disclose directly and clearly refutes the Moonlight
Prosecutors contention that failure to disclose . . . is not a fraud on the court. (Docket No. 612 at 18.) In the Ninth
Circuit, it clearly is. Pumphrey, 62 F.3d at 1133.
13
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Circuits opinion never discusses whether the corporations attorneys were aware that this perjury
was being committed.13 Two years later, after the corporation failed to pay the attorneys fees as
ordered, it was revealed the partnership had purchased the Corporations assets several months
before the corporate officer testified.14 Id. The court found there was a fraud on the court
because not only did the Corporation and the Partnership deceive the Levanders, . . . they also
deceived the court, because the court relied on the Corporations depositions to impose attorneys
fees on the Corporation rather than on the party with the assetsthe Partnership. Id.
5.
Because [t]he discovery process is an integral part of the judicial process, pervasive
Derzack v. County of Allegheny, Pennsylvania
10
discovery abuses and false discovery responses, even when not presented to the court, have been
11
found to amount to fraud on the court.15 Derzack v. Cnty. of Allegheny, Pa., 173 F.R.D. 400, 416
12
(W.D. Pa. 1996) affd sub nom Derzack v. Cnty. of Allegheny Children & Youth Servs., 118 F.3d
13
1575 (3d Cir. 1997). In Derzack, the parties were engaging in court-ordered discovery under the
14
authority and jurisdiction of the [court] and its rules and procedures. Id. The plaintiffs engaged
15
in a pattern and practice of stonewalling, bad faith and lack of candor. Id. The plaintiffs
16
manipulated financial data relevant to their business loss claim, and turned over falsified,
17
fraudulent documents to the opposing party. Id. at 404. One of the plaintiffs then testified falsely
18
at his deposition about these documents and related facts. Id. at 405. The plaintiffs argued there
19
was no fraud on the court, per se, because the fraudulent documents were never submitted to the
20
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13
Levander is yet another case which clearly demonstrates that the United States misstates the law regarding fraud on
the court in the Joint Status Report. (Docket No. 612 at 18.) Levander expressly refutes its assertion that perjury
can only be a fraud on the court if counsel committed or intentionally suborned the perjury and presented it to the
Court in an effort to influence its decision, as well as their statement that [p]erjury by a party or witness is not fraud
on the court . . . . (Id.)
14
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As was the case in Levander, the Moonlight Investigators and Prosecutors not only deceived Defendants, they
deceived the Court as well, and they did so not on peripheral issues but on issues going to the core of the case against
these Defendants. The Moonlight prosecutors submitted Whites declaration and the fraudulent Joint Report to this
Court in opposition to the motion for summary judgment. The Moonlight Prosecutors expected the Court to rely
upon the work of these investigators, and the Court did rely upon it, citing that declaration in its order denying the
motion.
15
Of course, Derzack directly contradicts the Moonlight Prosecutors statement that false answers to discovery
requests are not fraud on the court. (Docket No. 612 at 18.)
14
court. Id. at 403. However, the district court found that since the parties were engaging in
court-ordered discovery under the authority and jurisdiction of the [court] and its rules and
procedures[,] and the plaintiffs knowing and intentional improper conduct occurred under this
courts supervision and . . . grossly tainted the litigation process of the court, it did not matter
that the plaintiffs improper conduct did not violate a per se order of this court . . . . Id. at 416.
In short, the plaintiffs false discovery responses amounted to fraud on the court [b]ecause the
inherent power of the court reaches conduct both before the court directly and beyond the courts
confines, and because the discovery and settlement processes in this case were certainly within
the penumbra of the courts authority and at the hands-on supervision of [the magistrate judge] . .
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10
. . Id. Thus, the plaintiffs misconduct adversely impact[ed] the judicial system . . . . Id.16
11
6.
12
Fraud upon the court may also be found in an entire course of conduct by a party, rather
Fraud Upon the Court May Arise From a Course of Conduct.
13
than a single act of fraud directed at the court. Pumphrey, 62 F.3d at 1133 (listing course of
14
conduct undertaken by general counsel which constituted fraud on the court). There is no
15
authority suggesting that relief under Rule 60 depends on the existence of a single egregious act
16
of litigation malfeasance. Rather, the case law makes clear that fraud on the court occurs when a
17
party engages in fraud which does[,] or attempts to, defile the court itself, or is perpetrated by
18
officers of the court so that the judicial machinery cannot perform in the usual manner its
19
impartial task of adjudging cases that are present for adjudication. Intermagnetics, 926 F.2d at
20
916 (citation omitted). Whether the fraud which defiles the court occurs in a single act, such as
21
proffering perjured testimony for the courts reliance, Levander, 180 F.3d at 1120, or a course of
22
conduct, Pumphrey, 62 F.3d at 1133, is immaterial. The sole issue is whether the conduct
23
amounts to an effort by the [opposing party] to prevent the judicial process from functioning in
24
the usual manner. Stonehill, 660 F.3d at 445.
25
Stonehill evidences the Ninth Circuits recognition of this rule. There, the Ninth Circuit
26
analyzed seven separate instances of litigation malfeasance identified by complainant Stonehill,
27
16
28
As found by Judge Nichols, the Moonlight Fire prosecution was plagued by abuses affecting virtually every
aspect of the discovery process.
15
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who brought the Rule 60 action, as proof of the governments fraud on the court. 660 F.3d at
446-51. The Ninth Circuit first examined each instance of misconduct in isolation to determine
whether it constituted a fraud upon the court, and determined that each category did not
individually satisfy the standard. Id. at 466-51. The Ninth Circuit then examined whether the
allegations as a whole change[d] the story as presented to the district court such that they
amounted to fraud on the court. Id. at 451, 452. The court ultimately found that the conduct,
considered in its totality, did not constitute fraud on the court because it did not go to the central
issues of the case. Id. at 452. Despite this fact-specific conclusion, Stonehill makes clear that the
law does not require that the court analyze each instance of misconduct in a vacuum. Rather, the
10
court must also consider whether a partys entire course of conduct rises to the level of
11
harm[ing] the integrity of the judicial process such that it was prevent[ed] . . . from
12
functioning in the usual manner. Id. at 444-45. Accordingly, several instances of litigation
13
misconduct may collectively constitute a fraud upon the court, even where each instance,
14
considered separately, does not.
15
C.
16
17
A Motion or Action For Fraud on the Court is Not Precluded By Passage of Time or
Settlement.
There is no time bar to a motion or action to set aside a final judgment for fraud on the
18
court. Fed. R. Civ. P. 60(c). Indeed, the rule makes clear that the one-year time-limit applicable
19
to circumstances set forth in subdivision (b) does not apply to subdivision (d)(3). Fed. R. Civ. P.
20
60(c)(1). In keeping with the plain language of the rule, the Ninth Circuit has clearly held that
21
Rule 60 provides no time limit on courts power to set aside judgments based on a finding of
22
fraud on the court. Stonehill, 660 F.3d at 443 (citation omitted). [T]he power to vacate for
23
fraud on the court is . . . great, and is largely free from procedural limitations . . . . Id. at 444
24
(citing 11 Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure 2870 (2d ed.
25
1987)). Thus, any delay in bringing a motion or action for fraud on the court does not bar the
26
court from granting relief under Rule 60(d)(3). See, e.g., Hazel-Atlas, 322 U.S. at 247.
27
The Supreme Court has recognized, [E]ven if [the moving party] did not exercise the
28
highest degree of diligence [the] fraud cannot be condoned for that reason alone. . . . Surely it
16
cannot be that the preservation of the integrity of the judicial process must always wait upon the
diligence of the litigants. The public welfare demands that the agencies of public justice be not so
impotent that they must always be mute and helpless victims of deception and fraud. Id. The
Ninth Circuit echoed this reasoning in Pumphrey, stating: [E]ven assuming that [the plaintiff]
was not diligent in uncovering the fraud, the district court was still empowered to set aside the
verdict, as the court itself was a victim of the fraud. 62 F.3d at 1133.
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Lastly, Rule 60 unequivocally applies to any judgment, order, or proceeding, and makes
no distinction regarding its application to final dispositions such as stipulated judgments, consent
judgments, or settlement orders. See Fed. R. Civ. P. 60. Indeed, Rule 60(d) does not tie the
10
courts power to set aside a judgment for fraud on the court to the nature of the ultimate
11
disposition of the case. The case law is consistent with this broad language. Contrary to the
12
Moonlight Prosecutors assertion in their Joint Status Report, the Supreme Court implicitly
13
recognized in Hazel-Atlas that a court should grant relief from a judgment obtained by fraud on
14
the court even when the underlying action, in which the fraud on the court was committed,
15
involved a settlement agreement. 322 U.S. at 243.
16
Recognizing that resolution through a settlement agreement does not bar relief, other
17
courts have conducted a full analysis of the merits of a claim of fraud on the court where the
18
underlying litigation ended in a stipulated judgment or settlement agreement. For example, in
19
Herring v. United States, the Third Circuit analyzed the merits of a Rule 60 action to set aside a
20
fifty-year-old settlement agreement on the ground that the settlement was procured by fraud on
21
the court. 424 F.3d 384 (3d Cir. 2005). The courts determination that no fraud had been
22
committed was a substantive conclusion; the court did not even consider the amount of time that
23
had passed or the fact that the parties had settled. Id. at 390-92. Thus, in undertaking this
24
assessment, the court clearly recognized that the existence of the settlement itself was certainly no
25
bar to relief.
26
In Broyhill Furniture Industries Inc. v. Craftmaster Furniture Corporation, the Federal
27
Circuit engaged in a full analysis of the merits of a Rule 60 motion to vacate a consent judgment
28
for fraud on the court. 12 F.3d 1080 (Fed. Cir. 1993). The court ultimately denied the motion for
17
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a failure to show the requisite level of misconduct, but did not suggest that judgment entered in
connection with settlement was somehow beyond the courts reach under Rule 60. Id. at 1086-
87. In Black v. Suzuki Motor Corporation, the court found it unquestionable that the settlement
agreement reached by the parties in this case is rendered void by [the plaintiffs] false
representations, clearly material to the matters at issue in this civil case because [t]he settlement
agreement was procured through a fraud on the Court. No. 2:04-CV-180, 2008 WL 2278663, *3
(E.D. Tenn. May 30, 2008). And in Southerland v. Oakland County, after conducting an
evidentiary hearing, the district court found that the attorneys carefully planned scheme in the
underlying case departed from professional standards demanded of an officer of court and
10
required vacating the consent judgment for fraud on the court. 77 F.R.D. 727, 733 (E.D. Mich.
11
1978) affd sub nom. Southerland v. Irons, 628 F.2d 978 (6th Cir. 1980).
12
These cases merely represent instances where courts have denied relief under Rule 60(d)
13
due to insufficient evidence or procedural issues unrelated to the form of the final disposition of
14
the underlying judgment; in no way do these cases speak to the propriety of granting a Rule 60(d)
15
motion when the case involves a settlement agreement. The very fact that these cases address the
16
substantive issue of whether a party committed fraud on the court makes clear that, should a
17
moving party meet its burden of showing the existence of fraud on the court, a settlement
18
agreement does not bar setting aside the underlying judgment pursuant to Rule 60(d)(3).
19
Still, other cases purport to limit the availability of relief under Rule 60(d)(3) in the face
20
of a settlement agreement in the underlying action. To the extent any case law might suggest a
21
narrow and artificial constraint on claims of fraud on the court in cases resolved through
22
settlement or consent judgments, these cases are distinguishable or are wrongly decided and
23
contrary to controlling Supreme Court precedent. As set forth above, the Supreme Court and
24
lower federal courts have repeatedly recognized the need to protect the institutions of justice from
25
egregious fraud. See Hazel-Atlas, 322 U.S. at 246. Courts cannot lack the power to defend their
26
integrity against unscrupulous marauders; if that were so, it would place at risk the very
27
fundament of the judicial system. Aoude v. Mobil Oil Corp., 892 F.2d 1115, 1119 (1st Cir.
28
1989). As the First Circuit so precisely stated in Aoude, it is [s]urpassingly difficult to conceive
18
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of a more appropriate use of a courts inherent power than to protect the sanctity of the judicial
process to combat those who would dare to practice unmitigated fraud upon the court itself. To
deny the existence of such power would . . . foster the very impotency against which the Hazel-
Atlas Court specifically warned. Id. In light of the Supreme Courts decision in Hazel-Atlas,
and the many cases recognizing the robust inherent power of a federal court to confront fraud
worked upon it, a rule proscribing application of this power to judgments obtained through
settlement would not only be superficial, it would allow a wrong against the institutions set up to
protect and safeguard the public to go unchecked. Pumphrey, 62 F.3d at 1133 (quoting Hazel-
Atlas, 322 U.S. at 246). Thus, there is nothing about the settlement of the federal action that
10
limits or precludes in any way this Courts inherent power to address the egregious fraud upon the
11
court committed here.
12
D.
13
14
The Integrity of the Judicial Process is Most Severely Damaged When Government
Actors Defraud the Court.
1.
Because They Represent the Sovereign, Government Attorneys Are Held to a

Higher Standard.
15
The standards discussed above are applied even more stringently when the misconduct at
16
issue is alleged to have been committed by a government attorney. These lawyers for the public
17
play a unique role in our judicial system, as they are the representative not of an ordinary party
18
to a controversy, but of a sovereignty . . . [whose] interest in a . . . prosecution is not that it shall
19
win a case, but that justice shall be done. Berger, 295 U.S. at 88 (emphasis added); see also
20
A.B.A. Op. 150 (The prosecuting attorney is the attorney of the state, and it is his primary duty
21
not to convict but to see that justice is done.). As a result of this unique position, there are
22
special rules and standards in place, applicable only to government attorneys, defining a
23
government attorneys role, duties, and interests so as to safeguard the public and ensure the
24
integrity of both the judicial process and our government. An attorney representing the United
25
States, in particular, is held to a higher standard of behavior. United States v. Young, 470 U.S.
26
1, 25-26 (1985) (Brennan, J., concurring) (emphasis in original). This standard applies equally to
27
government attorneys in criminal and civil cases. See Freeport-McMoRan Oil & Gas Co. v.
28
F.E.R.C., 962 F.2d 45, 47 (D.C. Cir. 1992); see also A.B.A. Code of Profl Responsibility EC 719
DOWNEY BRAND LLP
14 (discussing application to civil actions). Under this heightened standard, [t]he public
prosecutor cannot take as a guide for the conduct of his office the standards of an attorney
appearing on behalf of an individual client. The freedom elsewhere wisely granted to a partisan
advocate must be severely curtailed if the prosecutors duties are to be properly discharged.
Profl Responsibility: Report of the Joint Conference, 44 A.B.A.J. 1159, 1218 (1958).
Generally speaking, these standards require that [a] government lawyer in a civil action .
. . should not use his position . . . to harass parties or to bring about unjust settlements or results.
A.B.A. Code of Profl Responsibility EC 7-14 (1980). A government lawyer also has an
obligation to refrain from instituting or continuing litigation that is obviously unfair. Id. More
10
specifically, responsibility to seek justice requires lawyers representing the United States to see
11
that all evidence relevant to the case is presented, even if unfavorable to its position. United
12
States v. Chu, 5 F.3d 1244, 1249 (9th Cir. 1993). A prosecutor thus occupies a dual role, being
13
obligated, on the one hand, to furnish the adversary element essential to the informed decision of
14
any controversy, but being possessed, on the other, of important governmental powers that are
15
pledged to the accomplishment of one objective only, that of impartial justice. Profl
16
Responsibility: Report of the Joint Conference, 44 A.B.A.J. 1159, 1218 (1958). Prosecutors must
17
present all relevant evidence because [a] prosecutor has the responsibility of a minister of justice
18
and not simply that of an advocate. This responsibility carries with it specific obligations to see
19
that the defendant is accorded procedural justice and that guilt is decided upon the basis of
20
sufficient evidence. Id. While the governments disclosure obligation encompasses more than
21
just exculpatory evidence, the failure to produce evidence material either to guilt or punishment
22
gives rise to constitutional violations. Brady v. Maryland, 373 U.S. 83, 87 (1947). A prosecutor
23
who withholds such evidence violates not only his disclosure obligations but also the due process
24
clause. Id. Due process is violated irrespective of the good faith or bad faith of the
25
prosecution. Id.
26
Although the Supreme Court has not yet explicitly stated that Brady applies in civil cases,
27
numerous federal courts have opined that the policy justifications underlying Brady apply in civil
28
settings as well. For example, in Demjanjuk v. Petrovsky, a Sixth Circuit case examining
20
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whether the government committed fraud on the court in civil extradition proceedings, the court
made clear that Brady should be extended to cover cases where the government seeks remedies
based on proof of alleged criminal activities of the party proceeded against. 10 F.3d 338, 353
(6th Cir. 1993) (discussing denaturalization and extradition cases). Likewise, in EEOC v. Los
Alamos Constructors, Inc., the court ordered the government to disclose a list of witnesses and
stated that a defendant in a civil case brought by the government should be afforded no less due
process of law than a defendant in a criminal case. 382 F. Supp. 1373, 1383 (D.N.M. 1974)
(citing Berger, 295 U.S. at 88). And in Sperry & Hutchinson Co. v. F.T.C., the court stated that
the due process requirements that inhere in a criminal case should also apply in civil actions
10
brought by the government because in civil actions, like criminal actions, the ultimate
11
objective is not that the Government shall win a case, but that justice shall be done. 256 F.
12
Supp. 136, 142 (S.D.N.Y. 1966) (quoting Campbell v. United States, 365 U.S. 85, 96 (1961)).
13
Brady is also applicable here, as this case is tantamount to a criminal case. Indeed, the United
14
States premised its claims against Defendants, in part, on criminal violations of 36 Code of
15
Federal Regulations 261.5, thus implicating its Brady obligations.
16
A federal prosecutors responsibilities also require him to take certain actions when he
17
suspects that a witness he has proffered has given perjured testimony: When a prosecutor
18
suspects perjury, the prosecutor must at least investigate. The duty to act is not discharged by
19
attempting to finesse the problem by pressing ahead without a diligent and good faith attempt to
20
resolve it. A prosecutor cannot avoid this obligation by refusing to search for the truth and
21
remaining willfully ignorant of the facts. Morris v. Ylst, 447 F.3d 735, 744 (9th Cir. 2006)
22
(quoting N. Mariana Islands v. Bowie, 243 F.3d 1109, 1118 (9th Cir. 2001)). The Supreme Court
23
has emphasized that the presentation of false evidence involves a corruption of the truth-seeking
24
function of the trial process. Id. (quoting United States v. Agurs, 427 U.S. 97, 103 (1976)).
25
Finally, the duty to disclose material evidence is not limited to government attorneys; it
26
also applies to investigating agencies. Both the Ninth Circuit and the Supreme Court have
27
recognized that exculpatory evidence cannot be kept out of the hands of the defense just because
28
the prosecutor does not have it, where an investigating agency does. Tennison v. City and
21
County of San Francisco, 570 F.3d 1078, 1087 (9th Cir. 2008) (quoting United States v. Blanco,
392 F.3d 382, 388 (9th Cir. 2004)). Giving investigators immunity from Bradys obligations
would undermine Brady by allowing the investigating agency to prevent production [to the
defendant] by keeping the report out of the prosecutors hands until the agency decided the
prosecutor ought to have it, and by allowing the prosecutor to tell the investigators not to give
him certain materials unless he asks for them. Id. (quoting Blanco, 392 F.3d at 388). Tennison
relies in part on Youngblood v. West Virginia, in which the Supreme Court made clear that
Brady suppression occurs when the government fails to turn over even evidence that is known
only to police investigators and not to the prosecutor. 547 U.S. 867, 869-70 (2006) (quoting
10
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11
Kyles v. Whitley, 514 U.S. 419, 438 (1995)).

For purposes of this motion, these standards serve as the measure of whether the
12
Moonlight Prosecutors conduct constitutes a wrong against the institutions set up to protect and
13
safeguard the public. Pumphrey, 62 F.3d at 1133 (quoting Hazel-Atlas, 322 U.S. at 246).
14
Appreciating the wrong committed by the Moonlight Prosecutors against these institutions
15
requires not only an understanding of their unique role within the justice system, but an
16
understanding of the trust placed in them by the public and by this Court as a direct result of
17
their position as Assistant United States Attorneys. Because a prosecutor is a public official
18
charged with law enforcement, a jury is likely to repose greater trust in his arguments than in
19
those of the defendants lawyer. The prosecutor must not abuse that trust by misleading the jury
20
about the law or the evidence or about the probity of the defendants lawyer . . . . Hennon v.
21
Cooper, 109 F.3d 330, 333 (7th Cir. 1997) (Posner, J.) (citing Berger, 295 U.S. 78; Stirone v.
22
United States, 361 U.S. 212 (1960)); see also Imbler v. Pachtman, 424 U.S. 409, 424 (1976)
23
(discussing public trust in prosecutors as reason prosecutors are immune from suits for
24
damages). Prosecutors important obligations, and the trust that the courts and the public
25
necessarily place in government attorneys and investigators to meet these obligations,
26
unfortunately make it easier for government attorneys and government investigators to
27
compromise the integrity of the judicial process and to improperly influence the court in its
28
decisions. Dixon, 316 F.3d at 1046; see Berger, 295 U.S. at 88 (It is fair to say that the average
22
jury, in a greater or less degree, has confidence that these obligations, which so plainly rest upon
the prosecuting attorney, will be faithfully observed. Consequently, improper suggestions,
insinuations, and, especially, assertions of personal knowledge are apt to carry much weight
against the accused when they should properly carry none.).
DOWNEY BRAND LLP
While much of the case law holds that a jury places greater confidence in a prosecutor, a
judge, knowing the duties and responsibilities of a prosecutor, must also assume that a prosecutor
is, at all times, seeking to do justice and acting in a manner befitting a public official charged
with law enforcement and a representative of the United States. See Hennon, 109 F.3d at 333.
A judge necessarily assumes that a prosecutor is not engaging in an effort . . . to prevent the
10
judicial process from functioning in the usual manner, Stonehill, 660 F.3d at 445, because any
11
such action by a prosecutor is not only incongruous with their duties as an attorney, but also in
12
direct violation of the higher standard of behavior to which a prosecutor is held, Young, 470
13
U.S. at 25-26. The Court is charged with the humbling task of defending the Constitution and
14
ensuring that the Government does not falsely accuse people, needlessly invade their privacy or
15
wrongfully deprive them of their liberty. The Court simply cannot perform this important task if
16
the Government lies to it. Islamic Shura Council of S. Cal. v. F.B.I., 779 F. Supp. 2d 1114, 1125
17
(C.D. Cal. 2011). While deception perverts justice[,] [t]ruth always promotes it. Id.
18
In engaging in the conduct detailed below, the Moonlight Prosecutors did not only violate
19
this higher standard of behavior. Stonehill, 660 F.3d at 445. They pervert[ed] justice,
20
Islamic Shura Council, 779 F. Supp. 2d at 1125, thereby preventing the judicial process from
21
functioning in the usual manner, Stonehill, 660 F.3d at 445, precisely because the judicial
22
process assumes and requires prosecutors to behave in a certain way. Indeed, [o]ur adversary
23
system for the resolution of disputes rests on the unshakable foundation that truth is the object of
24
the systems process which is designed for the purpose of dispensing justice. . . . Even the
25
slightest accommodation of deceit or a lack of candor in any material respect quickly erodes the
26
validity of the process. Shaffer, 11 F.3d at 457. By failing to meet this heightened standard
27
through the commission of numerous fraudulent acts, the Moonlight Prosecutors damaged the
28
validity of the process and, in so doing, worked a fraud on this Court.

23
2.
Recklessness by a Government Attorney is Sufficient to Constitute a Fraud

Upon the Court.
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2
3
As the Supreme Court held in Mapp v. Ohio, Nothing can destroy a government more
quickly than its failure to observe its own laws, or worse, its disregard of the charter of its own
existence . . . . Our Government is the potent, the omnipresent teacher. For good or for ill, it
teaches the whole people by its example . . . . If the Government becomes a lawbreaker, it breeds
contempt for law; it invites every man to become a law unto himself; it invites anarchy. 367
U.S. at 659. The Fourth Circuit echoed this concern, observing that when a government attorney
violates his duty of candor to the tribunal, causing our judicial process to falter, the people are
10
then justified in abandoning support for the system in favor of one where honesty is preeminent.
11
Shaffer, 11 F.3d at 457. Given that Rule 60(d)(3) serves as a means through which the court can
12
safeguard the integrity of the judicial process itself, relief under 60(d)(3) is particularly necessary
13
and appropriate where the threat to the judicial process is occasioned by government attorneys,
14
operating under a higher standard of care. Indeed, a fraud on the court perpetrated by government
15
attorneys and government investigators has far more serious consequences for both the court and
16
the public because of public trust placed in those individuals as government officers.
17
Given these duties, the Sixth Circuit found a government attorneys reckless disregard
18
for the truth sufficient to establish a fraud on the court. See Demjanjuk, 10 F.3d at 354. In
19
Demjanjuk, the court held that repeated failures to turn over exculpatory evidence was a fraud on
20
the court, even though such conduct would not have constituted a fraud on the court if committed
21
by a private attorney since a private attorney has no Brady obligations. Id. (finding the
22
government attorneys acted with reckless disregard for the truth and for the governments
23
obligation to take no steps that prevent an adversary from presenting his case fully and fairly.
24
This was fraud on the court in the circumstances of this case where, by recklessly assuming
25
Demjanjuks guilt, they failed to observe their obligation to produce exculpatory materials
26
requested by Demjanjuk.). The Sixth Circuit found that this failure on the part of the
27
government attorneys, and the resulting fraud on the court, was not consistent with the
28
governments obligation to work for justice rather than for a result that favors its attorneys
24
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preconceived ideas of what the outcome of legal proceedings should be . . . . Id. at 349-50.
Demjanjuks conclusion that the showing necessary for establishing that a government
attorney has defrauded the court is different and lesser than that applicable to a private attorney
is warranted in all cases involving fraud on the court by a government attorney. Indeed, it is
necessitated by the principle articulated in Mapp, the heightened standard of behavior applicable
to government prosecutors articulated in Berger, and the trust placed in prosecutors by the public
and the courts. Contrary to the Moonlight Prosecutors statement in their portion of the Joint
Status Report that a partys fraud upon the court requires the knowing and intentional
participation of its counsel, the reckless disregard for the truth, committed by attorneys who are
10
both officers of the court and federal prosecutors charged with doing justice is sufficient to
11
warrant a finding of fraud on the court. But even if their statement were correct, the evidence
12
here overwhelmingly demonstrates that the Moonlight Prosecutors knowingly and intentionally
13
defrauded the court.
14
15
16
III. EACH INSTANCE OF THE MOONLIGHT PROSECUTORS MISCONDUCT

CONSTITUTES A SEPARATE FRAUD ON THE COURT
Defendants understand that the Court will rule upon the sufficiency of the facts underlying
17
their Rule 60(d)(3) Motion by assuming those facts to be true in all respects (Docket No. 618),
18
and assessing them in relation to the standards for relief under Rule 60(d)(3). In accordance with
19
this Courts November 24, 2014, Order, and in an effort to reframe the underlying allegations in
20
the manner most convenient for the Courts assessment of whether the allegations, taken as true,
21
state a claim upon which relief under Rule 60(d)(3) can be granted, Defendants provide below
22
factual background that is germane to all instances of the Moonlight Prosecutors misconduct,
23
and then, as appropriate, additional facts which are relevant to each particular instance of
24
misconduct.
25
Immediately following each instance of misconduct, Defendants address whether,
26
assuming the truth of Defendants allegations, the facts separately constitute fraud on the court
27
within the meaning of Rule 60(d)(3). At the conclusion of the discussion regarding each separate
28
instance of misconduct, Defendants address whether the multiple instances of misconduct

25
collectively constitute fraud on the Court within the meaning of Rule 60(d)(3).
A.
1.
4
5
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Background Facts Relevant to All Instances of the Moonlight Prosecutors

Misconduct.17
A Brief Overview of the Moonlight Fire.
The Moonlight Fire began on a Monday, Labor Day, September 3, 2007, on private
property owned by members of the Landowner Defendants and managed by W.M. Beaty. While
somewhat remote, the property was a prime firewood cutting area for local townspeople. The
same property was also frequented by recreational users, including hikers, hunters, and
motorcycle and ATV riders. Because the area has been logged over the course of many decades,
10
the property is readily accessible through a substantial network of navigable dirt trails and roads
11
beneath the tree canopy. A number of people were in the area on Labor Day, or may have been.
12
On the day of the fire, Ryan Bauer, a resident of the town of Westwood, told his parents he would
13
be in the area to cut firewood, an activity he engaged in frequently through a side business he ran.
14
To do so, Bauer used an illegally modified chainsaw, which increased its fire danger. Shortly
15
after the Moonlight Fire started, a private patrolman found Bauers parents dangerously close to
16
where the fire began; he testified that the Bauers said they were looking for their son Ryan.
17
During his deposition, their son encircled an area which included where the fire started as his
18
favorite place to cut firewood.
19
Others may have been in the area too, including Michael McNeil, a United States Forest
20
Service (USFS) employee and suspected serial arsonist on numerous fires that appeared to
21
coincide with his arrival on a variety of geographical assignments. After a lengthy attempt to
22
catch McNeil using transponders and surveillance, McNeil was inexplicably promoted to
23
Battalion Chief, Fire Prevention, and transferred to Lassen National Park about two months
24
before the Moonlight Fire began. His whereabouts the morning and early afternoon on the day of
25
the Moonlight Fire are unknown because the Moonlight Investigators never bothered to look into
26
17
27
28
Defendants previous brief filed in support of the Rule 60(d)(3) Motion provided extensive evidentiary factual
details to support the relief sought. Detailed evidentiary support for all of the facts identified herein is contained in
Defendants previous briefing (Docket No. 593-3), the Declaration of William R. Warne (Docket No. 596), and
Defendants Request for Judicial Notice (Docket No. 593-10).
26
whether McNeil may have been responsible for starting the fire before they released their origin
and cause scene. 18
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On the morning and early afternoon of the day the fire started, two Howell employees,
J.W. Bush (Bush) and Kelly Crismon (Crismon), were using bulldozers to create soil berms
or water bars across skid trails to help prevent erosion. They were there because earlier that
year, defendant Sierra Pacific had won a bid to harvest a portion of property owned by the
Landowner Defendants. In turn, Sierra Pacific hired Howell to conduct the logging operations on
the Landowner Defendants land.
Both operators wrapped up their work that day before 1:00 p.m., drove down to a service
10
road and then parked their bulldozers about a mile to the south where they serviced them before
11
leaving. By 1:30 p.m., each was headed back toward the nearby town of Westwood in his pickup
12
truck with windows down. At no time while working in the area that day, while at the log
13
landing, or as they drove out, did they smell or see any smoke or fire. Within two hours of
14
finishing their work, Bush attempted to return to the general area in which he had been operating
15
but was prevented from doing so by the Moonlight Fire.
16
The Moonlight Fire was spotted from the closest USFS lookout tower and called in at
17
2:24 p.m. The Red Rock Lookout Tower is located on Red Rock peak about ten miles away.
18
Once the fire was called in, suppression resources were directed to the site, but the Moonlight
19
Fire would still burn approximately 65,000 acres over the course of the next two weeks, some
20
45,000 acres of which were in the Plumas and Lassen National Forests, the property of the United
21
22
23
24
25
26
27
28
18
The Moonlight Investigators failure to investigate the whereabouts of McNeil is even more inexcusable in light of
what they knew at the time. Lead Moonlight Investigator White was so concerned about McNeils arrival in the area
that summer that White quickly made a point of requesting that a transponder be placed on the bottom of McNeils
USFS issued pickup truck. Ultimately, McNeil was arrested and charged with arson in another matter and with
making extortionist email threats to various judges, law enforcement officials, and politicians, including Senator
Barbara Boxer and Congresswoman Mary Bono. McNeil pled guilty to the extortionist threats, a crime he initially
carried out through a complicated scheme designed to make it appear as if his ex-wife were the perpetrator.
Defendants were keen to take McNeils deposition because of the blame-someone-else nature of his crimes, the
long-held suspicions that McNeil may be a serial arsonist who could easily perpetrate such crimes while in his USFS
uniform and vehicle, and the timing of his arrival in Susanville in relationship to the Moonlight Fire. Defendants
therefore deposed McNeil in the state action on February 14 and 15, 2013, at the R.J. Donovan Correctional Facility,
where he is serving a nineteen year, eight month sentence. During that deposition, McNeil testified that he
understood how to make timing devices which could start wildfires, and that the types of devices and the length of
the fuses was only limited by the imagination of the creator. He confirmed that such delayed ignition mechanisms
could be set to last anywhere between minutes to days.
27
DOWNEY BRAND LLP
States. The USFS and Cal Fire jointly worked to extinguish the blaze.
2.
The USFS and Cal Fire jointly investigated the Moonlight Fire, and later jointly issued
The Moonlight Fire Investigation, as Told Through the Joint Report.
their official report on the cause of the fire, entitled Origin and Cause Investigation Report,
Moonlight Fire (Joint Report). The Joint Report was prepared and signed by two law
enforcement officers: Cal Fires investigator Joshua White (White) and the USFSs
investigator Diane Welton (Welton). However, the first investigator on the scene was USFS
investigator David Reynolds (Reynolds), who had been dispatched to the scene shortly after the
fire was called in by the Red Rock Lookout Tower. He arrived at approximately 3:30 p.m.
10
White, a Cal Fire Battalion Chief and law enforcement officer, was also dispatched to the fire,
11
arriving later that same evening. Because it was too hot and too dark to do any substantive
12
investigative work on that first night, White and Reynolds agreed they would start their joint
13
investigation the next morning.
14
Early that next morning, on September 4, 2007, Reynolds and White began their
15
investigation, with White taking the lead. As they walked into the fire area, they eventually found
16
a skid trail. 19 After turning on that trail and walking down a slope, they located some rocks with
17
strike marks, which they preliminarily identified as the general location of where the fire began.
18
Without securing the scene, they left, drove back towards Westwood for lunch, and used their
19
phones to set up a meeting with Howell bulldozer operator Crismon. The investigators conducted
20
their first interview of Crismon back at the fire scene, in their chosen origin area, finishing that
21
discussion at roughly 6:00 p.m. During that meeting, Crismon confirmed that he had been in the
22
area earlier that day installing water bars. Thereafter, White took Crismon back down the hill,
23
while Reynolds stayed behind to begin processing the scene, putting a pink tape around their
24
chosen area of origin and marking the scene with indicator flags.
25
When White returned, he and Reynolds continued placing indicator flags in the area they
26
27
28
19
Skid trails are pathways within the forest created by bulldozers dragging logs down to landings where the logs
are then removed by logging trucks to take them to mills.
28
designated as the general area of origin. According to their training, blue flags are used to denote
where the fire was backing, yellow flags where the fire was moving laterally, and red flags where
the fire was advancing. A white flag typically designates the point of origin. White has conceded
that one of the primary goals of a wildland fire investigation is to find a point of origin. White
also testified that finding the fires point of origin is necessary before determining the cause of the
fire as it is at that point where any physical evidence of the actual ignition is likely to be located.20
DOWNEY BRAND LLP
White and Reynolds returned the next morning, September 5, at roughly 8:00 a.m. The
Joint Report provides that when they returned they placed numbered plates next to certain fire
indicators, photographing those indicators as they went. The Joint Report also provides that
10
White and Reynolds used a handheld magnet to sweep the area in an effort to identify any
11
ferrous material. Within close proximity of two of the rocks . . . a ferrous material consistent
12
with that of metal shavings, were recovered. According to the Joint Report, White and Reynolds
13
placed the metal allegedly found at these two rocks into one bag, which they labeled E-1, for
14
Evidence #1. After finding the metal, the investigators left the origin area and walked downhill
15
to their trucks, where they photographed the metal at 10:02 a.m.
16
By 10:15 a.m. on September 5, 2007, White and Reynolds concluded that the Moonlight
17
Fire was caused by rock strikes from a Howell bulldozer. Importantly, they then released their
18
area of origin less than 48 hours after having commenced their investigation. According to
19
Reynolds, they were confident and they were done. Indeed, later that same day, Reynolds
20
finished an Incident Report identifying Sierra Pacific as the defendant.
21
Three days later, on September 8, 2007, Special Agent Welton, a law enforcement officer
22
with the USFS, replaced Reynolds as the USFSs lead investigator. Welton visited the fire scene
23
that morning with White, along with her supervisor and fellow USFS law enforcement officer
24
Marion Matthews (Matthews). Both Welton and Matthews were directed to join the
25
20
26
27
28
As discussed infra, the USFS and Cal Fires lead origin and cause investigator Larry Dodds, an expert in the
science of origin and cause investigations, confirmed during his deposition that being off by eight feet regarding the
point of origin can make a world of difference, as locating the correct point of origin is critical to establishing
causation. If investigators find what they believe is a competent ignition source in a spot where the fire did not start,
they are necessarily missing what could be far different causation potentials at the actual point of origin a timing
device, a gasoline spill, a match, a set of footprints, etc.
29
investigation by their supervisor Craig Endicott (Endicott), Assistant Special Agent in Charge.
Both Matthews and Welton had a keen interest in the actions of USFS Fire Prevention
Management Officer Michael McNeil, who they and others suspected of being a serial arsonist.
In fact, Endicott instructed Welton to put together a confidential lengthy report cataloguing
McNeils disturbing criminal history before being hired by the USFS, as well as his geographical
assignments and the numerous arson fires that invariably broke out in those areas shortly after his
arrival. Yet during their depositions, both Matthews and Welton disclaimed any interest in
McNeil with respect to the Moonlight Fire.
DOWNEY BRAND LLP
When Matthews and Welton visited the fire scene on September 8, 2007, Matthews told
10
Welton that she had reservations about the size of the alleged origin area as established by White
11
and Reynolds. Matthews believed that the origin area should have been enlarged to encompass
12
more area farther up the hill to the west.21 The Joint Report, however, says nothing whatsoever
13
about Matthews stated concerns that the investigators should have enlarged their area of origin to
14
extend farther up the hill, nor does the Joint Report say anything about the arrival of USFS
15
employee Michael McNeil into the area several weeks before the Moonlight Fire.
16
After this investigation, nearly two years passed. Finally, on June 30, 2009, the USFS and
17
Cal Fire released their Joint Report, which concluded that the cause of the Moonlight Fire was a
18
rock strike with the grouser or front blade from S-2 CRISMONs bulldozer. This Joint Report
19
contains an official sketch that identifies two separate points of origin, labeled E-2 and E-3.
20
As thoroughly discussed in this motion, however, Defendants have discovered clear and
21
convincing evidence that the Joint Report fails to disclose what actually happened during the
22
Moonlight Fire origin and cause investigation and that, instead, the Joint Report covers up the real
23
conduct of these investigators during their origin and cause investigation.
24
3.
25
On August 4, 2009, approximately a month after the Joint Report was released, White
26
signed and sent a letter to each of the primary Defendants, claiming that they had been found
The Initiation of the State Actions.
27
21
28
Placing the fire farther up the hill would have brought the alleged points of origin closer to the area where the 3:09
p.m. Air Attack video, discussed infra, shows the smoke plume.
30
DOWNEY BRAND LLP
responsible for the Moonlight Fire and that they were therefore liable for $8.1 million that Cal
Fire allegedly incurred in suppressing and investigating the cause of the Moonlight Fire.
However, instead of demanding full payment to the State of California, White sought the reduced
amount of $7.6 million for the State of California, but then also demanded that Defendants issue a
separate check in the amount of $400,000, payable to something called the CDAA Wildland Fire
Training and Equipment Fund.22 White stated that if Defendants failed to comply with the
demand for payments as set forth in the letter within thirty days, Cal Fire would file its action
against them and add interest to its damage claim.
Cal Fire did not wait thirty days. On August 9, 2009, the Office of the California
10
Attorney General filed its Moonlight Fire action in Plumas County Superior Court on behalf of
11
Cal Fire. Cal Fires lead counsel was Supervising Deputy Attorney General Tracy L. Winsor
12
(Winsor), primarily assisted by Deputy Attorney General Daniel M. Fuchs.
13
Several other private parties who claimed damages from the Moonlight Fire also filed suit.
14
In total, there were five private party lawsuits and one Cal Fire suit. Because all six state court
15
lawsuits (seeking well over $60 million in damages) relied on the same joint USFS and Cal Fire
16
origin and cause investigation, the state court consolidated the actions early in the litigation for
17
purposes of discovery, and later consolidated all matters for a trial on liability (together referred
18
to as the state action).
19
4.
20
In the summer of 2008, before the Joint Report was released, and well before Cal Fire
The Initiation of the Federal Action.
21
filed its action, Assistant United States Attorney Robert Wright (Wright), the acting head of the
22
Affirmative Fire Litigation Team in the Eastern District, had become particularly interested in the
23
Moonlight Fire because of the substantial damage it had caused to USFS land. In fact, Wright
24
ultimately sought and obtained an early referral because he believed he had a strong case on
25
liability and also knew that there were extensive damages. Wright also understood that such
26
27
28
22
After settlement of the federal action, Defendants later learned that this fund was internally referred to as
WiFITER and, as discussed more fully below, was controlled by Cal Fire, not the California District Attorneys
Association.
31
referrals were typically not given until after the Forest Service determined its amount of claimed
damages.
DOWNEY BRAND LLP
At some point prior to October of 2008, Wright retained several expert consultants and, on
or about October 2, 2008, visited the fire site with consultants along with another Assistant
United States Attorney. When they arrived in the area, they were joined by Moonlight
Investigators White from Cal Fire and Welton from the USFS. Consistent with what is described
in their dishonest Joint Report, the investigators both claimed the Moonlight Fire was caused by a
rock strike from a metal tracked bulldozer working in their selected area of origin. When
driving back into town in a pickup truck with White and Welton, Welton told Wright theres
10
something that we need to tell you. Welton then explained that investigator Matthews, who had
11
visited the alleged origin five days after it began, had wanted the investigators to declare a larger
12
alleged origin area for the fire. At the time, Wright believed that White and Welton were
13
scrupulously honest and trustworthy in their conduct of the investigation and preparation of the
14
Report. Later, however, when Defendants asked Welton about this issue in her deposition, she
15
denied any memory of it.23
16
After discussing the matter with his consultants, and with investigators White and Welton,
17
Wright began the process of drafting the Moonlight Fire complaint on behalf of the United States,
18
eventually executing and filing that complaint on August 31, 2009, three weeks after Cal Fire
19
filed its complaint and nearly two years after the fire began. Thereafter, Wright oversaw the
20
21
22
23
24
25
26
27
28
23
In his declaration, Wright explains: In hindsight, I believe that Matthews thought that the fire may well have
originated in a location different from where the investigators had alleged. Wrights loss of trust is warranted on
numerous levels, as discussed further herein. On this point, while Welton confessed Matthews concerns to Wright,
she was not so forthcoming to Defendants under oath and instead kept to the script of the falsified Joint Report.
Specifically, Welton suppressed the harmful key fact regarding Matthews during her deposition. On August 15,
2011, Welton testified as follows:
Q: Was there any discussion that you recall at the scene about the general area of origin being
potentially larger than the area that was bounded by the pink flagging?
A: I dont recall having that discussion.
Q: Did Marion Matthews at any point in time ever express to you the thought that she believed the
general area of origin should have been bigger, both uphill and downhill?
A: Not that I recall.
The fact that Welton made a point of telling Wright about Matthews critical commentary is directly at odds
with what she told Defendants under oath, yet another example of the Moonlight Investigators willingness
to cover up information harmful to their goal of pinning blame for this fire on their chosen targets.
32
DOWNEY BRAND LLP
federal Moonlight Fire litigation (federal action) until January 4, 2010. On that day, Wrights
supervisor, Assistant United States Attorney David Shelledy (Shelledy), abruptly removed
Wright from the federal action with an additional instruction that Wright viewed as
unprecedented in his many years of experience as a federal prosecutor. Specifically, Shelledy
told Wright that he was not only being relieved as the lead prosecutor, but that he was barred as
of that day from working on the federal action in any capacity whatsoever.
Shelledy then replaced Wright with Assistant United States Attorney Kelli Taylor
(Taylor), who led the prosecution of the federal action from that point forward. Three months
later, Taylor signed the United States first Rule 26 disclosure, claiming damages against
10
Defendants in excess of $791 million. Together with estimated interest and attorney fees,
11
Taylors disclosure brought the total claim against these Defendants to more than $1 billion.24
12
The fair market value of federal property where the fire burned were it placed on the open market
13
was approximately $100 million.
14
For the next three years, the Moonlight Prosecutors and Cal Fire collaborated under their
15
joint prosecution agreement regarding this two-front litigation. For example, the federal and state
16
prosecutors coordinated deposition scheduling so that testimony from certain witnesses could be
17
used in both actions. They also collaborated so that certain depositions would only be taken in
18
one action. The Moonlight Prosecutors would often attend depositions noticed only in the state
19
action, and vice versa. Additionally, the federal and state prosecutors jointly prepared the
20
primary investigators for their depositions, hired many of the same consultants, and disclosed
21
many of the same expert witnesses.
22
5.
23
Defendants intended to defend themselves at trial by demonstrating the investigators lack
24
The Resolution of the Federal Action.
of credibility, highlighting the absence of any credible evidence that Howell had started the fire,
25
24
26
27
28
On October 21, 2011, the United States supplemented its initial disclosures, reducing its purported damages to
approximately $662 million. However, in that disclosure, the United States also reserved its right to seek a jury
instruction that would permit the jury to assess environmental damages in an amount significantly higher than the
number listed herein. The federal action continued to pose catastrophic damages for Defendants. Thousands of jobs
and the viability of entire communities in many already depressed Northern California logging regions hung in the
balance.
33
and submitting compelling evidence that the Moonlight Fire was most likely started by a third
party. The Moonlight Prosecutors filed motions with this Court attempting to prevent Defendants
from advancing these defenses at trial.
4
5
pretrial orders holding, among other things, that Defendants could not elicit any evidence to argue
that someone else started the fire. As alleged more fully below, Defendants learned after the
conclusion of the federal action that the Moonlight Prosecutors procured this ruling by defrauding
the Court through concealment of critical evidence that would have been material to the Courts
ruling. Additionally, the Court tentatively held that, under title 14, section 938.8 of the California
10
Code of Regulations, Defendants could be liable even if a third party started the Moonlight Fire.
11
This ruling was contrary to well-established California law.
12
DOWNEY BRAND LLP
On July 2, 2012, at the urging of the Moonlight Prosecutors, the Court issued tentative
With one of their primary defenses gone, Defendants faced going to trial in an economic
13
death penalty case against the Moonlight Prosecutors, who had repeatedly demonstrated a
14
willingness to breach their ethical duties to defraud Defendants and the Court. While the Courts
15
tentative rulings on the motions in limine were certainly factored into Defendants assessment of
16
whether to settle the federal action, also of critical importance was the threat of ongoing
17
misconduct by the Moonlight Prosecutors, who continued to engage in egregious fraud relating to
18
the central issues of the case. Defendants thus reached the reluctant decision to resolve the
19
federal matter.
20
In eventually agreeing to settle the federal action, Defendants understood the great power
21
wielded by the Moonlight Prosecutors who, as Assistant United States Attorneys, were naturally
22
(albeit incorrectly) presumed by the Court to be fulfilling their duty to seek justice and
23
behaving not only in accordance with the ethical rules binding all attorneys, but also in accord
24
with the heightened standards of conduct applicable to government attorneys.
25
Under the terms of the settlement agreement, Defendants agreed to collectively pay the
26
United States $55 million over time and Sierra Pacific agreed to convey 22,500 acres of its land
27
to the United States over time. Because the settlement agreement contemplated performance over
28
a period of years, the parties expressly agreed that the Court would retain jurisdiction over the
34
DOWNEY BRAND LLP
enforcement of the agreement. In connection with the settlement agreement, the Court issued an
order confirming its ongoing jurisdiction.
In their portion of the Joint Status Report (Docket No. 612) the Moonlight Prosecutors
assert, counterfactually, that Defendants only pretended to settle the federal Moonlight Fire
action. The Moonlight Prosecutors contend that at the time of the federal settlement in July 2012,
Defendants were supposedly concealing their present intent (apparently meaning at the time of
the settlement) that they would seek to set aside the settlement for fraud upon this Court. In
support of these contentions, the Moonlight Prosecutors cite to a Sierra Pacific July 17, 2012,
press release. Therein, Sierra Pacific trial counsel William Warne is quoted as stating,
10
Typically, a settlement signifies the end of a dispute, but this is just the beginning. Properly
11
understood in context, neither Sierra Pacifics press release nor Mr. Warnes statement support
12
the Moonlight Prosecutors preposterous assertion. Indeed, the circumstances surrounding this
13
press release reveal yet additional misconduct by the Moonlight Prosecutors.
14
In their portion of the Joint Status Report, the Moonlight Prosecutors fail to apprise the
15
Court of several critical considerations concerning Sierra Pacifics press release. First,
16
notwithstanding the federal settlement, Defendants were still set for a jury trial in Plumas County
17
several months later in the state action, in which damages in excess of some $60 million were
18
claimed. Despite their ethical obligation not to make public comments that might unfairly
19
influence the Plumas County jury pool, the Moonlight Prosecutors brazenly held a press
20
conference immediately following the federal settlement in which they announced their record
21
settlement and wrongly blamed Defendants for having started the Moonlight Fire, even though
22
the agreed upon settlement contains Defendants explicit denial of having started the fire. See
23
Cal. Rule Prof. Conduct 5-120(A); A.B.A. Rule 3.8 (Special Responsibilities of a Prosecutor).
24
In retrospect, the Moonlight Prosecutors press conference appears to have served two
25
purposes: first, it was an obvious effort to influence the Plumas County jury, thereby increasing
26
the potential that a state court jury would essentially ratify what the Moonlight Prosecutors knew
27
was otherwise a corrupt prosecution. And second, it was meant to trumpet their record
28
settlement for purposes of career advancement and garnering personal accolades. The fact that
35
DOWNEY BRAND LLP
such extrajudicial comments would interfere with Defendants constitutional right to a fair and
unbiased jury in their upcoming trial in the state action, and the fact that such statements are
proscribed by all applicable ethical rules, did nothing to dissuade the Moonlight Prosecutors.
Nevertheless, faced with the likelihood that the Moonlight Prosecutors unethical
extrajudicial statements had polluted the Plumas County jury pool (which is within the Eastern
District), Defendants had no choice but to respond and publically deny these wrongful and
improper allegations, as was their absolute right under California Rule of Professional Conduct 5-
120(C). Sierra Pacific did so in its own July 17, 2012, responsive press release appropriately
titled, Sierra Pacific Corrects Misstatements Made by United States Attorney on Moonlight
10
Fire. Sierra Pacifics counsels statement that the federal settlement was just the beginning
11
was merely an expression of Defendants expectation that they would vindicate themselves in the
12
trial of the state court actions nothing more. The Moonlight Prosecutors effort to
13
mischaracterize Mr. Warnes comments as crowing to the press, while concealing from the
14
Court the true circumstance which necessitated Sierra Pacifics press release, is simply more
15
evidence that the Moonlight Prosecutors feel quite at liberty to continue misleading this Court.
16
At no time before the entry of Judge Nicholss February 4, 2014, Orders, wherein he
17
found by clear and convincing evidence that the Moonlight Fire investigation and prosecution
18
were corrupt and tainted, had Defendants even considered the possibility of seeking to set aside
19
the judgment in the federal action. Further underscoring the absurdity of the Moonlight
20
Prosecutors assertion that the federal settlement was a charade is the fact that Defendants have
21
now paid the United States well over $30 million as part of the federal settlement, and the fact
22
that Sierra Pacific has conveyed to the United States thousands of acres of land. Defendants can
23
assure the Court that these payments and land conveyances most certainly are not pretend.
24
As alleged further herein, new evidence has come to light since the federal settlement
25
which demonstrates that the Moonlight Prosecutors misconduct was even worse than suspected,
26
and had the Court and Defendants known of this misconduct during the pendency of the federal
27
action, it would likely have changed the outcome of Court rulings which were substantial factors
28
in causing Defendants to settle. Despite Defendants diligent efforts to obtain all discoverable
36
DOWNEY BRAND LLP
information, they were unaware of this evidence due to the active and intentional efforts by the
Moonlight Prosecutors and their joint prosecution partner Cal Fire and its attorneys to conceal it
in violation of all ethical and legal requirements.
6.
After the settlement of the federal action, discovery continued in the state action. In the
spring of 2013, the state court issued two rulings rejecting Cal Fires effort on cross-motions for
summary adjudication to import the tentative pretrial rulings in the federal action into the state
action, such that Defendants could be held liable for the Moonlight Fire even if it was caused by a
third party. In ruling on these cross-motions, the state court found that Cal Fire could only
Resolution of the State Court Action.
10
recover its suppression costs if Defendants caused the fire. The state court likewise ruled that title
11
14, section 938.8 of the California Code of Regulations could not create a duty on the part of
12
Defendants under principles of California tort law to suppress or detect third party fires.
13
Thereafter, Judge Nichols was assigned to the case for all purposes by the Chief Justice of
14
California under the Assigned Judges Program. On July 26, 2013, following a lengthy three-day
15
hearing, Judge Nichols issued a series of orders dismissing the state court actions and entering
16
judgment for Defendants on the ground that, among other things, Plaintiffs could not present a
17
prima facie case on the element of causation.
18
After obtaining these dismissals, Defendants continued their effort to expose the egregious
19
misconduct associated with the prosecution of these actions by filing a Motion for Fees, Expenses
20
and/or Sanctions on October 4, 2013. The filing of this motion initiated a lengthy process
21
involving the submission by all parties of thousands of pages of briefing, declarations with
22
evidence, deposition transcripts and deposition video. As set forth more fully below, in late 2013,
23
Defendants discovered by chance that during the entire pendency of the state and federal
24
Moonlight Fire action, Cal Fire has been wrongfully and intentionally withholding documents and
25
evidence which established that the lead Moonlight Investigator, law enforcement officer White
26
and his direct supervisor and mentor Alan Carlson (Carlson), had been engaged in skimming
27
millions of dollars of state wildfire settlements into an illegal off-books account which they and
28
others controlled, such that they had a direct contingent personal/financial interest in the outcome
37
of the Moonlight Fire investigation and litigation.
Four months later, on February 3 and 4, 2014, Judge Nichols heard oral argument on the
Motion for Fees, Expenses and/or Sanctions. In considering this motion, Judge Nichols was the
first neutral arbiter to have an opportunity to consider the full scope of the governments abuse in
the investigation and prosecution of the state and federal actions. In the afternoon of February 4,
2014, Judge Nichols issued two orders, one twenty-six pages and the other fifty-eight pages. The
twenty-six page order contains the courts conclusions regarding Cal Fire and its counsels
conduct as a whole, which the court read from the bench. The fifty-eight page order contains
detailed findings supported by references to evidence. Together, the orders terminated Cal Fires
10
lawsuit in its entirety for its egregious and reprehensible conduct.
11
DOWNEY BRAND LLP
12
Additionally, the orders awarded Defendants full compensatory attorney fees and
expenses amounting to approximately $32.4 million.
13
In these orders, the court found that Cal Fires actions initiating, maintaining, and
14
prosecuting this action, to the present time, is corrupt and tainted. Cal Fire failed to comply with
15
discovery obligations, and its repeated failure was willful. Additionally, the court found that Cal
16
Fire had engaged in egregious and reprehensible conduct and a systematic campaign of
17
misdirection with the purpose of recovering money from Defendants.
18
Although the misconduct was so pervasive that it would serve no purpose for the Court
19
to recite it all, the court made specific findings that critical USFS and Cal Fire witnesses failed
20
to testify honestly, falsified witness statements, and falsified both the Joint Report for the state
21
and federal actions, as well as other origin and cause reports, which they attempted to use in
22
support of their prosecution of the state and federal actions. Judge Nichols specifically noted the
23
misconduct of various USFS witnesses, including the improper efforts of the two federal
24
investigators, Reynolds and Welton.

While the court elected not to sanction counsel for Cal Fire, 25 the court expressed
25
26
27
28
25
The court noted that its leniency regarding Cal Fires counsel in no way speaks to issues of legal ethics or
compliance with the requirements of the State Bar Act. The court also noted that its lenity, prudence, and caution
as it relates to sanctions against officers of the court should not in any way be seen as softening or mitigating the
force of this Courts decision, findings and orders as it relates to Cal Fire. It simply means that, whatever else might
be said about the conduct and advocacy of cited attorneys, it will not be sanctioned here.
38
profound concerns regarding the conduct of the state prosecutors. The court stated:
The sense of disappointment and distress conveyed by the court is so

palpable, because it recalls no instance in experience over forty seven
years as an advocate and as a judge, in which the conduct of the Attorney
General so thoroughly departed from the high standard it represents, and,
in every other instance, has exemplified.
3
4
5
6
The court also found that the state prosecutors created a tremendous burden on the court
by allowing a meritless matter to go forward, and that this ran afoul of their responsibility to
only advance just actions.
7.
Wright and His Experiences Relating to the Moonlight Fire and Other
Wildfire Cases in the Year He Filed the Moonlight Action.
10
DOWNEY BRAND LLP
11
Wright, having left the United States Attorneys Office, eventually obtained copies of the
12
termination orders issued by Judge Nichols in the state action. After reviewing Judge Nichols
13
orders as well as a copy of the Joint Report and other materials, Wright concluded that a grave
14
injustice had occurred during the prosecution of the federal action, which led to his preparation of
15
a declaration in support of this motion.
16
In the spring of 2009, Wright was working on other wildland fire prosecutions for the
17
office. In one of those cases he had determined that he was ethically obligated to disclose a
18
document to the defense that called into question the viability of the governments prosecution in
19
that matter. At the time the Civil Chief in the Office was Shelledy. Wright sought advice from
20
the Department of Justices Professional Responsibility Advisory Office (PRAO) in
21
Washington, D.C. PRAO supported Wrights understanding that he had to disclose the
22
document, and Wright dismissed the action. Several months later, in August of 2009, Wright
23
filed the United States complaint in the federal action.
24
In the fall of that year, on a separate wildland fire action he was handling, Wright had a
25
significant disagreement with Shelledy regarding Wrights desire to carry out what he believed
26
was his ethical obligation to disclose to the defense a document revealing a serious calculation
27
error which incorrectly increased the United States damage claim in the action by $10 million.
28
Because Shelledy resisted disclosing this error, Wright sought advice from PRAO to obtain
39
DOWNEY BRAND LLP
support for the proper exercise of [his] professional responsibilities. When Wright received
advice from PRAO stating it was his ethical obligation to disclose the $10 million reduction to the
defense, Shelledy continued to oppose disclosure by sending his own email to PRAO, questioning
the advice PRAO gave to Wright on the matter. When that effort failed, Shelledy sent Wright an
email stating, Okay, Bob, thats a beginning. Now what can you do to avoid creating an ethical
obligation to volunteer a harmful document? Because Wright believed that, as a lawyer for the
Department of Justice and member of the California Bar, he had a broad duty of candor to the
court and a responsibility to seek justice and develop a full and fair record, he responded to
Shelledy by explaining, David, pursuing our theory of timber loss requires disclosure. The only
10
way I am aware of to moot the disclosure requirement would be to drop the claim for timber
11
losses, which would result in a lower damages number than simply disclosing the harmful
12
document. Wright states that his supervisor Shelledy responded by calling his comment
13
flippant.
14
Thereafter, on October 23, 2009, PRAO attorney Kandice Wilcox responded with a
15
crystal clear directive, stating in an email, Part of the issue in making a false statement means
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not only an affirmative mis-statement but deliberately withholding information which refutes the
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position you assert. Wright provided the calculation error document in the United States initial
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disclosures and the case has since settled.
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Thereafter, Shelledy treated Wright with hostility. Wright further states, the internal
20
struggles that I encountered in 2009 with respect to my professional concerns on these wildland
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fire actions marked the first time in my 40 years of practicing law that I felt pressured to engage
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in unethical conduct as a lawyer. On January 4, 2010, just after receiving a commendation from
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United States Attorney Benjamin Wagner for his work on another wildland fire matter, Civil
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Chief Shelledy abruptly relieved Wright of any and all responsibility for the Moonlight Fire,
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forbade him from working on the matter in any capacity, and replaced Wright with Taylor.
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Shelledy told Wright that lately they disagreed about almost everything. Taylor remained lead
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counsel for the United States for the remainder of the case.
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8.
Wright is not the only federal prosecutor who worked on the federal action and who
opened up about the misdirected prosecution of this matter. In March of 2011, Eric Overby
(Overby), a highly respected senior Assistant United States Attorney from Salt Lake City, came
to Sacramento to assist with the federal action. 26 Unfortunately, after working on the case for
several months, Overby became frustrated with his inability to rectify the prosecutorial problems
he was witnessing. In fact, Overby told Daniel Kim, an attorney representing the Landowner
Defendants and W.M. Beaty, the following: Imagine youre on a train that is running out of
control towards the edge of a cliff. You really only have two options: head to the front of the
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train and try to gain control or jump off. Im choosing to jump off.
On May 12, 2011, Overby contacted Sierra Pacifics lead trial counsel William Warne to
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Assistant United States Attorney Eric Overby
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inform him that he would be leaving the Moonlight prosecution team. Overby asked Warne if
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they could meet in person, and they set up a meeting later that same day at Downey Brand.
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During that meeting, Overby confirmed with Warne that he was leaving the matter and going
15
back to Utah. He said, If I thought there was anything positive that would result from me
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staying, then I would stay. Overby also told Warne that it was a physics problem, and that, If I
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am banging my head against a brick wall, then my head loses. Echoing similar sentiments as
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expressed by Judge Nichols regarding the rarity of what he was witnessing, Overby also said, In
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my entire career, yes, my entire career, I have never seen anything like this. Never. Overby told
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Warne that he told someone (presumably in his office) a few days earlier the following: Its
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Sometime after his arrival, Overby spoke with Katherine Underwood, an attorney working at the time for Rick
Linkert at Matheny, Sears, Linkert & Jamie, who was acting lead trial counsel for W.M. Beaty and the Landowner
Defendants. Overby told Underwood that he was working on the Moonlight Fire matter as an evaluator. Overby
also told Underwood that he had hoped his presence in this case could repair some of the damage that had been done
by Taylor to the working relationship with defense counsel. Underwoods declaration summarizes a telling point of
discussion with Overby as follows:
In order to further explain his role in the Moonlight Fire prosecution, Mr. Overby told me about
another United States prosecution he had been sent to evaluate shortly before trial. Mr. Overby
said there was a deposition taken, essentially on the eve of trial, wherein evidence was obtained
that demonstrated the governments case should be dismissed. Mr. Overby recommended
dismissal with prejudice, his recommendation was accepted, and the United States reimbursed the
defendant(s) their defense costs. Mr. Overby described this action to me as the most satisfying act
of my career.
41
called the Department of Justice. Its not called the Department of Revenue. Since we are the
Department of Justice, we win if justice wins.
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Office in December of 2010. During that call, Overby asked Wright, Is it just me, or is there
something seriously wrong in the Eastern District Civil Division management? Later in May of
2011, Overby met with Wright in person and discussed his dissatisfaction with the prosecution of
fire cases by the Eastern District. Later, Overby told Wright that he was so concerned with the
management of fire litigation matters in the Eastern District that he altered his plans to stay in
California and instead decided to return to the United States Attorneys Office for the District of
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In May of 2011, Overby also contacted Wright, who had left the United States Attorneys
Utah.
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9.
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The Office of Professional Responsibility was established by order of the Attorney
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General to ensure attorneys and law enforcement personnel with the Department of Justice
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perform their duties in accordance with the highest professional standards expected of the
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nations principal law enforcement agency. In July, Defendants submitted a lengthy brief to the
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Office of Professional Responsibility in Washington D.C. detailing the prosecutorial misconduct
17
on the part of certain federal prosecutors who took over the federal action after Wrights removal.
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B.
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Filing With The Office of Professional Responsibility
Selected Instances of Prosecutorial Misconduct, Each of Which Separately

Constitutes Fraud on the Court.
Using as guideposts controlling legal authorities on the kind of conduct which triggers the
21
need for judicial action under Rule 60(d)(3), it is clear that the interconnected conduct of the
22
Moonlight Fire prosecutors and investigators rises well above what is required for finding a fraud
23
upon the court that species of fraud that does grave damage to the integrity of the judicial
24
system. The Moonlight Fire case reflects a multi-faceted plan designed and executed within the
25
realm of this litigation to prevent the judicial process from functioning in the usual manner.
26
Stonehill, 660 F.3d at 445. At every turn, these prosecutors and investigators attempted to cause
27
the system to dispense justice based on various and repeated acts of deception. See Shaffer, 11
28
F.3d at 458. While the following examples are by no means exhaustive, they highlight some of
42
the more obvious occurrences of investigative and prosecutorial misconduct which separately and
collectively worked an egregious fraud upon this Court, an appalling expanse of misconduct
which now cries out for termination and the vacation of the settlement.
1.
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The Moonlight Prosecutors Advanced a Fraudulent Origin and Cause

Investigation in the Litigation and Allowed the Investigators to Repeatedly
Lie under Oath about the Very Foundation of Their Work, Thereby
Committing a Fraud Upon the Court.
The Relevant Facts
The effort to change the story regarding the origin and cause of the Moonlight Fire
began on the hillside September 4-5, 2007, continued with the drafting of the Joint Report, and
persisted throughout the Moonlight Fire litigation, up until the time of that judgment was entered.
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Specifically, the Moonlight Investigators attempted to create the fiction that their
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investigation focused on just two points of origin, identified as E-2 and E-3, a fiction which they
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then repeated in the Joint Report. In reality, however, the Moonlight Investigators conceived of
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these two official points of origin well after releasing the scene. Their investigation on the
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hillside on September 4-5, 2007, focused on a different, secret point of origin, denoted by a white
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flag, the existence of which they concealed from the Joint Report.
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While these efforts by the Moonlight Investigators to change the story about the origin
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of the fire began pre-litigation, the Moonlight Prosecutors joined, advanced, and actively
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participated in that effort by transporting the fraudulent fire investigation and the fraudulent Joint
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Report into the jurisdiction and oversight of this Court. Ignoring their obligations as
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representatives of the government, the Moonlight Prosecutors allowed the Moonlight
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Investigators to testify falsely in their depositions about the most critical aspects of their work,
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and put them perfectly at ease as they repeatedly did so.
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Discussed below are the facts relating to the secret, undisclosed point of origin marked by
25
a white flag, and the efforts by the Moonlight Prosecutors to enhance their chance of prevailing
26
against Defendants by advancing a false narrative regarding the E-2 and E-3 points of origin in
27
the litigation.
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1
2
What Transpired on the Hillside on September 4-5, 2007.
The primary purpose of any wildland fire investigation is to find where and how the fire
started to accurately locate its origin and to then find its cause. To accomplish this,
investigators are trained to use a systematic and scientific process. First, the investigators read
burn indicators to locate the general origin area of the fire, then they locate a smaller specific
origin area, and within that area they find the point of origin and next identify the competent
ignition source at that location.
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a.
As this sequence reveals, locating the correct point of origin is critical to determining the
actual cause of the fire. Finding that point of origin is necessary before determining the cause
10
because that is where any physical evidence of the actual ignition is going to be located. Natl
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Fire Protection Assn 17.1 (Generally, if the origin of a fire cannot be determined, the cause
12
cannot be determined.). The Moonlight Prosecutors primary origin and cause expert testified
13
that incorrectly locating the point of origin by even eight feet can make a world of difference
14
because, without a correct origin, an investigator cannot identify the correct ignition source and
15
thus cannot identify the correct cause of the fire.
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Because of the critical importance of the origin to the cause determination, fire
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investigators are trained to carefully document their determination of its location. Thorough and
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proper documentation of the origin typically includes such tasks as placing a white flag at the
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origin, photographing the origin, identifying immovable reference points in the vicinity of the
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origin, taking measurements of the location of the origin in relation to these reference points, and
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sketching or diagramming the location of the origin.
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Despite what they state in their Joint Report and despite to their repeated testimony that
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they identified their official E-2 and E-3 points of origin before releasing the scene on the
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morning of September 5 the Moonlight Investigators did absolutely nothing during their actual
25
investigation to mark or assess these false points of origin. While under oath, White conceded
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that neither he nor Reynolds ever marked their E-2 and E-3 points of origin with a white flag, the
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color that investigators use to denote the point of origin. White testified that he and his co-
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Moonlight Investigator used blue, yellow, and red indicator flags as they processed the scene, but
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testified that they never placed a white flag in their scene for any purpose at all, and did not place
any white flags at E-2 or E-3.
In addition to conceding their failure to mark E-2 and E-3 as their points of origin, White
and Reynolds admitted that they never documented, flagged, or marked those points in any way.
When asked why, White said, I dont know. That White would profess under oath to having no
explanation for having failed to mark the supposed points of origin, the identification of which
was one of the primary goals of the entire investigation, is an affront to the judicial process.
White took no contemporaneous photos fixed on the rocks he claimed to identify as his points of
origin and no photos of the location where he testified that he collected the metal that
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supposedly started the fire. When asked Can you tell me why you didnt do that? White
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responded, No. His testimony is blatantly false. There is no record of any interest in these
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points because they had no interest in these points. Under oath, the Moonlight Investigators
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simply did not want to reveal that they fabricated these points of origin after finishing their
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investigation, and suppressed evidence revealing what they had actually done during their
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investigation. In short, because the official points of origin E-2 and E-3 were created after the
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Moonlight Investigators had processed and released the alleged scene of the origin of the fire,
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there is no evidence in the record which confirms the Moonlight Investigators had any interest in
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those points when they processed the alleged origin scene on September 4-5.
19
On the other hand, the Moonlight Investigators performed extensive work during these
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two days of investigation before releasing the scene regarding their actual, and suppressed, point
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of origin. Once one cuts through their deception, the suppressed evidence reveals that on the
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evening of September 4, the Moonlight Investigators were focused on a different rock in a skid
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trail about 10 feet away from the official E-2 and E-3 points of origin. Reynolds took his only
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GPS measurement during the investigation from this rock and wrote the coordinates on a form
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entitled Fire Origin Investigation Report, a critical document that the investigators never placed
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in their Joint Report. White took three photographs of Reynolds as he took these measurements,
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one of which is presented here.
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The next morning, September 5, beginning at approximately 8:00 a.m., the Moonlight
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Investigators established two reference points, labeled RP1 and RP2, from which they then
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took five separate photographs between 8:18 a.m. and 8:20 a.m. three from RP1 and two from
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RP2. Each one of these photographs depicts a white flag in the middle of the field of view,
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hanging from a metal stem placed into the soil next to a large rock on a skid trail in a different
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location from the trail presented in the Joint Report. The large white flag rock in these five
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photographs is the same rock White repeatedly photographed Reynolds crouching over on
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September 4 as Reynolds took the only GPS reading of the investigation. All five of these
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photographs of the white flag were suppressed from the Joint Report. One of Whites five
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reference point photographs of the white flag is provided for reference below in a magnified and
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cropped format.
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The Moonlight Investigators then took precise distance and bearing measurements from their two
reference points directly to the same rock where they had placed the white flag, triangulating and
measuring to that location with accuracy to a quarter-of-an-inch and to a single degree. 27
Reynolds then recorded these distance and bearing measurements on a form entitled Fire Origin
Sketch, which the investigators also omitted from the Joint Report.28
The suppressed sketch, shown below, shows a single point of origin alongside the same
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skid trail, which Reynolds marked with an x and labeled P.O. The key on this same form
also confirms his intent, as it states that x = point of origin. Retained United States expert land
surveyors David Wooley and Christopher Curtis and fire investigator Larry Dodds all confirmed
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during their depositions that these distance and bearing measurements intersect perfectly at the
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large rock marked with the white flag.
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White attempted during this matter to deny under oath the importance of these reference points in relationship to
their suppressed white flag. Yet in another wildland fire matter, White had no trouble explaining the process and the
critical purpose associated with triangulating measurements to his point of origin. Specifically, on August 8, 2008, in
Cal Fire v. Dustin White (Lassen County Superior Court Case No. 43654), White testified that, aside from trying to
get the absolute measurement to be able to go and recreate that point of origin so that I establish two reference points.
Then I take those measurements. Thats the very foundation of a origin and cause investigation.
28
Both Reynolds and White denied any on-site connection to the sketch. However, as discussed more fully, infra,
Defendants discovered that these law enforcement officers actually took a photo of a portion of the sketch while they
photographed the metal fragments on a sheet of white paper at 10:02 a.m. that same morning.
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1
As they processed the alleged origin scene on September 5, the Moonlight Investigators
carefully set up the evidence of their work. White took two critical photographs, one at 9:16 a.m.
and another at 9:25 a.m. Both of these photographs are in the Joint Report and entitled,
eponymously, Overview of Indicators.
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White confirmed under oath that he took these two Overview of Indicators photographs
to create a photographic record showing the substance of the investigators primary scene
processing work the blue backing flags, the yellow lateral flags, and the red advancing flag,
along with numbered placards to identify certain burn indicators related to their directional
flagging. There is nothing whatsoever in either of these photographs signifying any interest in the
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Moonlight Investigators claimed points of origin E-2 and E-3, a fact perfectly consistent with
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their after-the-fact fabrication of these so-called points of origin. Below is a copy of the
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photograph that White labeled Overview of the Indicators.
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Importantly, under computer magnification of a native photo, this Court will see that there
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is in fact a white flag in the 9:16 a.m. overview of indicators photo, stuck in the ground at, as
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one would expect, the very same spot revealed by the five white flag photographs omitted from
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the Joint Report.29
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Importantly, the Moonlight Investigators decided to place this critical overview of indicators photo in their Joint
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Consistent with the Moonlight Investigators focus on a single point of origin, there is one
plastic bag containing metal shavings, which the Joint Report calls Evidence #1 or E-1. This
Court will see that those metal shavings sit directly on top of a white sheet of paper in a photo
taken at 10:02 a.m. just before the investigators released their scene, and that underneath that
sheet of paper sits the secret sketch containing the single point of origin. 30 A side by side
comparison of the full sketch, and the photo showing the left edge of the sketch under a piece of
paper, is provided below. 31
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Report, as such overview photos are an essential and required element of any origin and cause report. They must not
have been too worried about being forced to do so, as each of these two overview photos as copied into the Joint
Report is so small and of such poor resolution that the secret white flag is all but invisible to the naked eye in printed
copies of the Joint Report. Their ruse nearly worked. Initially, defense counsel missed the white flag as they
carefully reviewed the Joint Report as well as all of the native photographs of the investigators work in those first
two critical days. In all of those photographs, especially the 9:16 a.m. overview photograph, the white flag easily
fades into the background. Eventually, however, defense counsel spotted the single white flag while reviewing the
native photographic files on a computer screen with back-lit magnification.
30
Consistent with his other acts of deception, when defense counsel showed White this smoking gun sketch, he
repeatedly testified that he had not seen it during his investigation, knew nothing about it, and did not learn of its
existence until it was shown to him by prosecutors well after this case began. Reynolds also attempted to distance
himself from the sketch by testifying that he must have prepared it after the investigation but back at his office.
Despite their deceit, they drafted the sketch during their investigation, and they had it with them when they took
photos of the cause of the fire, and it is their own photo that gives them away as it reveals that they had actually
placed it on the hood of Whites vehicle, just underneath the photo of the metal they collected from the hidden point
of origin revealed by the sketch itself. On these lies alone, a properly aligned federal prosecutor would have
dismissed the case immediately on the ground that the Moonlight Investigators had no respect for the law, had no
qualms about lying under oath, and were attempting to collect money on the basis of a deception. Here, the
Moonlight Prosecutors pressed forward, undeterred by the growing body of evidence demonstrating that they were
aiding and abetting a colossal fraud upon the court.
31
A more detailed analysis of this photographic comparison is provided in exhibits to the Declaration of William R.
Warne (Docket No. 596) Ex. 41 at 129-130, 220-221; Ex. 45 at 26; Ex. 47 at 4-5, 45, Ex. 58; Ex. 59; Ex. 61.
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White struggled to explain why if he actually had found two points of origin and
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collected metal from two separate spots he would have put what he claims are competent
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ignition sources into one bag; White then had no choice but to concede that doing so would have
18
been a violation of evidence collection protocols.32
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In short, a timeline of the key events on September 4 and 5 reveals that the investigators
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did everything possible to document their actual and suppressed point of origin, while doing
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nothing to document their so-called official points of origin E-2 and E-3:
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At the time White collected the metal, it was of course not a violation of evidence protocols, as he and Reynolds
only had a single point of origin, which is why they placed what they found into a single bag.
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Notably, on September 5, 2007, the date the Moonlight Investigators were doing
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everything possible to document their actual and suppressed point of origin, White was taking
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copious field notes. Reynolds, who was with White at all times during the scene processing,
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confirmed this fact during the course of his November 1, 2012, deposition. Had the notes been
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preserved, Defendants are informed and believe that they would have detailed the careful steps
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the Moonlight Investigators took with respect to the placement of the white flag at a single point
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of origin, their careful recordation of distance and bearing measurements to that single point from
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two fixed reference points, their collection of metal fragments from that single point, and their
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placement of those metal fragments into a single plastic bag, all before they released the alleged
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origin area at 10:15 a.m. on September 5, 2007.

At the time he created his notes, and at all times thereafter, White knew the Moonlight
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Fire was likely to result in litigation. 33 White nevertheless destroyed his notes and his
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Specifically, on September 5, 2007, the day White and Reynolds processed the alleged origin scene, Reynolds
listed Sierra Pacific Industries as the Defendant on an incident report. That same day, Cal Fire retained litigation
consultant/metallurgist Lester Hendrickson, and White met with him five days later. By September 5, 2007, the
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contemporaneous computer files before the federal action commenced.34 Notably, at the time
White destroyed these materials, Cal Fire did not have any policy requiring their destruction.
White thus destroyed these notes of his own accord, and for his own reasons. After having done
so, White advanced the false narrative in the Joint Report. With the notes gone, the Moonlight
Investigators believed they were free to select and shape the evidence, unimpeded by
contemporaneous notes of what actually occurred when the origin scene was processed.
b.
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The Moonlight Investigators Are Confronted in Deposition with Evidence

of Their Secret Origin.
During their depositions, the Moonlight Investigators violated their oaths by denying any
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knowledge of the significant and purposeful nature of their multi-faceted effort with respect to
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their secret origin, even when Defendants confronted them with indisputable evidence of their
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focused work. White repeatedly testified that the only points of origin he and his co-Moonlight
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Investigator ever located were two points on a spur trail, E-2 and E-3. White also testified that he
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found the metal fragments the Moonlight Investigators claimed were the ignition source adjacent
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to these two rocks. Reynolds testified similarly. This testimony was false.
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During these questions and answers, the Moonlight Prosecutors sat on their hands, doing
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nothing to prevent the Moonlight Investigators desperate efforts to exploit the discovery process
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and our system of justice to prop up their fictional Joint Report. Ironically, it was Whites own
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photographs of their white flag which he had omitted from the Joint Report because of what
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they revealed that caused his descent into additional perjury. When initially provided with a
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copy of the first omitted white flag photograph he took on September 5, 2007, at 8:18 a.m., White
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Moonlight Fire had already grown to over 22,000 acres. On September 7, 2007, White interviewed Bill Dietrich of
Howell and reported, Dietrich said the [Safeco] policy was for $3 million liability insurance, as required by SPI.
Dietrich said he would fax me a copy of their insurance policy. White testified that his investigation included
assessing insurance policies of potential defendants. White also admitted that he understood that fires of every
variety can result in litigation. Each of these facts evidences that White was already contemplating not only the
litigation that the Moonlight Fire would result in, but who would be the defendant in that case.
34
Not only did White violate Brady in destroying his notes, White also violated criminal obstruction of justice laws
of the United States. 18 U.S.C. 1512(c) provides that: [w]hoever corruptly(1) alters, destroys, mutilates, or
conceals a record, document, or other object, or attempts to do so, with the intent to impair the objects integrity or
availability for use in an official proceeding; or (2) otherwise obstructs, influences, or impedes any official
proceeding, or attempts to do so, is subject to a fine or imprisoned not more than 20 years, or both. 18 U.S.C.
1512(c).
52
denied that there was any white flag in its view, an assertion he apparently believed he needed to
at least attempt because defense counsel had earlier obtained his testimony that neither he nor
Reynolds ever placed a white flag anywhere in origin area for any reason. Thereafter, White
nervously testified that he was unable to explain why there was a white flag in the center of five
photos he carefully aligned and took from his chosen points of reference.
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Reynolds attempted similar acts of deceit. In March of 2011, and despite incontrovertible
evidence to the contrary, Reynolds also repeatedly testified that the Moonlight Investigators did
not use any white flags. When Defendants confronted him with photographs of the white flag,
including the one above, Reynolds denied ever placing any white flags, and claimed that what is
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obviously a white flag in the photograph above looks like a chipped rock. Reynolds then
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compounded his deception. On November 15, 2011, during his deposition in the federal action,
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defense counsel asked Reynolds about the correlation between the white flag and the distance and
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bearing measurements Reynolds recorded on his concealed sketch. In response, Reynolds
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testified that these have nothing to do with any kind of a white flag. Later, in that same
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deposition, Reynolds perjured himself again, claiming the distance and bearing measurements in
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his sketch intersected at E-3, eight to ten feet away from the rock marked with the white flag at
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which the distance and bearing measurements actually intersect. Despite the fact that the
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Moonlight Prosecutors own designated surveying expert David Wooley (as well as all defense
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surveying experts) testified that Reynoldss distance and bearing measurements intersected
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exactly at that white flag, the Moonlight Prosecutors breached their duty of candor by doing
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nothing to correct the record or correct Reynolds false testimony.
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During the last day of his deposition in the state action, well after the settlement of the
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federal action, and after it was clear that both Reynolds and White were not credible, Reynolds
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tried yet another tack, stating that he likely placed the white flag, but that they must have later
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discounted the significance of the rock it marked and abandoned it that same morning in favor of
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the E-2 and E-3 rocks. But Reynoldss last effort to salvage the Moonlight Investigators and
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Prosecutors charade fails for numerous reasons.
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White and Reynolds had both earlier testified that they never placed a white flag, had no
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idea how it eventually found its way into their scene, and that they had no interest whatsoever in
the spot marked by the white flag. They had plenty of chances to state otherwise in their
depositions. Indeed, White testified that he does not know why Reynolds was crouched over the
same rock with a GPS unit (despite the fact that he took not one, but three photos of Reynolds
performing this act), does not know when the white flag was placed on that rock, when it was
removed, or why a series of photographs focused upon it. He denied that the white flag was ever
even the focus of the photographs. This testimony was false.
White also testified that he took the five photos which depict the same white flag in the
center not to photograph a white flag, but to instead photograph the reference rocks themselves,
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so that others could go back out to this exact location and have this angle line up and be able to
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say, okay, thats Reference Point 1. All of this testimony was false.
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White refused to acknowledge that the photographs were centered on the white flag, as
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doing so would reveal that he and Reynolds were actually focused on a point of origin far
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different than the official points of origin he and Welton had already fully committed to in the
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official Joint Report. He also refused to concede the issue, as doing so would reveal that they
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released the scene before deciding that they needed to change (and conceal the fact that they were
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changing) their actual point of origin. 35 All of this testimony was false.
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Moreover, when White and Reynolds were shown the presence of the white flag in the
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9:16 a.m. Overview of Indicators photo, magnified with the aid of a back-lit computer screen,
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each of them preposterously testified that they could not explain why it was there, despite the fact
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that the very purpose of their overview photo was to create a record of the most important
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indicators of their work, including, of course, just where they identified their point of origin
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through the placement of the white flag. All of this testimony was false.
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White and Reynolds forgetfulness about their numerous and meaningful acts, and their
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outright denial of them, are not functions of misplaced memory. Instead, they are the function of
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In the same section of Whites deposition, the following questions and answers were exchanged: Q: And do you
know why there is a white flag at that rock? A. I believe I have answered it. No, I dont. Q: Okay. And its true that
you guys changed your point of origin at some point in time after that morning of September 5th, correct? A: No.
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a fraud. These acts of perjury were not related to minor issues, but to the very essence of their
work and the central issue in the federal action namely, where the fire started, how it started and
who started it. Indeed, this false testimony by law enforcement officers White and Reynolds
provided while in uniform and while wearing a gold badge is a function of profound
investigative corruption regarding key facts, transported into the province of this Courts
jurisdiction with ill-intent and without regard for the solemn vow of honesty inherent in all
discovery. 36
DOWNEY BRAND LLP
The fraudulent nature of law enforcement officers White and Reynolds testimony was
recognized by the joint origin and cause expert for the United States and Cal Fire, Larry Dodds,
10
who after spending more than a thousand hours examining the evidence, finally conceded in May
11
of 2013 (after the conclusion of the federal action) during a state deposition that the white flag
12
raises a red flag, creates a shadow of deception over the investigation, and caused him to
13
conclude its more probable than not that there was some act of deception associated with
14
testimony around the white flag. Likewise, Cal Fire Unit Chief Bernie Paul later admitted in the
15
state case that the evidence and testimony surrounding the white flag caused him to disbelieve the
16
Moonlight Investigators.
17
As Dodds and Paul understand, investigators do not forget about the very foundation of
18
their work, and they do not forget about the time expended and the physical tasks associated with
19
performing that work, such as taking measurements with a tape and a GPS device and carefully
20
recording them, or standing behind each reference point and taking five photos of the white flag
21
at that same rock, carefully lining each up so the white flag is centered.
22
The Moonlight Investigators did not forget about these actions when they intentionally
23
excluded the evidence of each of them from the Joint Report. And they did not forget about these
24
actions when they pretended to remove them from their memories as they violated their oaths.
25
26
27
28
36
Testifying in this manner is akin to two law enforcement officers, while under oath, forgetting about the
apprehension of a criminal suspect even though the officers recorded his weight and height, even though they
sketched his face, even though they photographed him not once, but numerous times, and even though his presence at
the scene was recorded when the crime was committed and then failing to weigh, sketch, measure, or photograph
their new suspect at all.
55
Each act was purposeful, and the Moonlight Investigators efforts to deny any memory of those
acts or deny any understanding of just how a single white flag became the focus of their attention
and their photographs is nothing less than a substantial fraud upon this Court.
c.
5
6
The Moonlight Prosecutors were not just silent as the Moonlight Investigators testified
untruthfully about the primary focus of their work; the Moonlight Prosecutors also affirmatively
assisted and encouraged this false testimony, a fact recognized by Judge Nichols.
DOWNEY BRAND LLP
The Moonlight Prosecutors Affirmatively Assisted and Encouraged the

Moonlight Investigators False Testimony.
In particular, in order to prepare for his deposition, law enforcement officer Reynolds
10
attended a January 2011 meeting at the United States Attorneys Office in the Eastern District of
11
California with law enforcement officer White, special agent Welton, and the federal and state
12
prosecutors, Taylor and Winsor. White also confirmed that he and Reynolds, as well as Taylor
13
and Winsor, were present at this January meeting in the morning for three hours, and that co-
14
investigator Welton joined the group for another four hours after lunch.
15
During this meeting, which occurred after White had already been deposed for six days,
16
and during which the defense had exposed the white flag, the Moonlight Prosecutors used a
17
computer screen to enhance the images of the white flag. They openly discussed the white flag
18
with Reynolds. Instead of demanding answers, the Moonlight Prosecutors encouraged more
19
deceit by telling Reynolds that the white flag was a non-issue, a fact that Reynolds finally
20
revealed during the last day of his deposition during the state action on November 1, 2012, long
21
after the conclusion of the federal action.37
22
23
In March 2011, a few weeks after this January 2011 meeting, Defendants deposed
Reynolds and asked him about this same topic. 38 In response, Reynolds feigned ignorance,
24
37
25
During the last day of his state deposition, and after the federal settlement had been reached, Reynolds testified as
follows: And they said it was going to come up and saw it as a nonissue.
38
26
27
28
Curiously, Reynolds was defended by newly-arrived Assistant United States Attorney Overby, who was not at the
meeting to prepare Reynolds for his deposition. The deposition transcript reflects that lead prosecutor Taylor was in
attendance on the first day of the deposition, but skipped the second day when Sierra Pacifics counsel began asking
questions about the white flag. During Reynoldss November 15, 2011, federal deposition, Taylor was once again
absent, while Assistant United States Attorney Glen Dorgan defended the deposition. While the timing of Taylors
absence during Reynoldss depositions is interesting, it does nothing to absolve her of her responsibility to have made
56
DOWNEY BRAND LLP
responding I dont really see a flag and testifying it looks like a chipped rock. As noted
above, Reynolds also falsely denied that his distance and bearing measurements recorded on the
concealed scene sketch had any relationship to the rock marked with the white flag, and falsely
claimed that the measurements intersected eight to ten feet from the white flag. The Moonlight
Prosecutors had actual knowledge that this testimony was in fact false, as they had earlier
discussed the white flag with Reynolds.
As Reynolds repeatedly provided false testimony throughout his deposition, the
Moonlight Prosecutors did nothing to intervene or to correct the record afterward, as was their
responsibility. The Moonlight Prosecutors apparently believed that Defendants would never
10
discover what had been discussed with Reynolds during their pre-deposition meeting, and
11
remained mute.39 In fact, Defendants did not learn about the discussion of the white flag at the
12
pre-deposition meeting until after Defendants prevailed on a motion to compel. Only then did
13
Reynolds hesitantly reveal to Defendants the facts associated with his pre-deposition meeting and
14
the white flag discussion with the federal and state prosecutors.40
15
Judge Nichols reviewed this series of events relating to the meeting at the United States
16
Attorneys Office. In his February 4, 2013, Orders, he stated that these events stood out among
17
so many acts of evasion, misdirection and other wrongful acts . . . . His Honor stated that the
18
court was deeply troubled by two things: First, that Reynolds, one of the primary Moonlight
19
Investigators, would admit one thing to a table of friends and then refuse to admit the same
20
thing once put under oath, and second, that the prosecutors sat idly by as Reynolds . . . denied
21
22
23
24
25
26
27
28
sure that Reynolds testified honestly and to have corrected his testimony when she found out that he had not been
truthful. Instead, Taylor did nothing to correct the record regarding this foundational dishonesty.
39
During the deposition of Reynolds in March of 2011, the federal and state prosecutors instructed him not to
answer questions about what was discussed during the meeting at the United States Attorneys office, invoking the
attorney-client privilege and their joint prosecution agreement. Thereafter, Defendants were able to reopen his
deposition after prevailing on a motion to compel because both Reynolds and White had been named as experts for
the United States. Indeed, because the United States had named both White and Reynolds as experts, Magistrate
Judge Brennan ruled that none of the discussions which took place in their presence were confidential.
40
After Magistrate Brennans order, Defendants deposed Reynolds again in November of 2011. Even then,
Reynolds attempted to waffle on what he saw when viewing photographs with the federal and state prosecutors, but
he ultimately conceded the existence of a white flag. A year later, in November of 2012, Defendants deposed
Reynolds in the state action. During that deposition, Reynolds clearly conceded the existence a white flag in the
photos shown to him by the prosecutors.
57
DOWNEY BRAND LLP
in his deposition what he had conceded in . . . counsels presence several weeks earlier.
Although most of the false testimony by the Moonlight Investigators concerning the
concealed initial point of origin was known to Defendants before the settlement of the federal
action, the admissions from the governments retained experts regarding the deception by the
Moonlight Investigators, and the effect this had on their opinions, were not disclosed until expert
discovery commenced in the state action, well after the federal action settled. Moreover,
Reynolds did not reveal until his state deposition in 2013 that he had been advised by the
Moonlight Prosecutors that the white flag was a non-issue. This does not preclude relief under
Rule 60(d)(3). See Hazel-Atlas, 322 U.S. at 246 (setting aside a judgment for fraud upon the
10
court notwithstanding the fact that the parties settled, that the defrauded party did not seek relief
11
until seven years after the settlement, and that the defrauded party suspected and was actively
12
investigating the fraud at the time of the settlement).
13
14
Analysis
The Ninth Circuit has observed that most fraud upon the court cases involve a scheme by
15
one party to hide a key fact from the court and the opposing party. Stonehill, 660 F.3d at 444.
16
Here, the fraud upon the Court involved a scheme by the Moonlight Investigators, and later the
17
Moonlight Prosecutors, to hide a key fact the original origin determination from Defendants
18
and this Court. Indeed, despite the very purpose of the Joint Report, to report the truth and only
19
the truth, that official law enforcement document advanced a critical falsehood, and covered up
20
the truth about the original origin determination, perhaps the most important issue in this
21
litigation. As noted by former federal prosecutor Wright, The change in the point of origin and
22
the reasons for the change should have been, but were not, disclosed in the Report. Despite their
23
obligation to do so, the Moonlight Investigators, and later the Moonlight Prosecutors, never
24
disclosed this exculpatory information to Defendants.
25
Perhaps worse, the Moonlight Prosecutors allowed both White and Reynolds to testify
26
dishonestly about their scene processing and origin determination. They intentionally sat in
27
silence as the Moonlight Investigators repeatedly testified in ways that were directly contradicted
28
by their own concealed conduct, photographs, and documents. Once confronted with what
58
actually happened, properly focused federal prosecutors would have insisted that the Moonlight
Investigators testify honestly regarding their work on the hillside that day, and forced the creation
of a truthful Joint Report. Properly focused federal prosecutors would have also certainly abided
by their duty of candor to this Court by immediately reporting the Moonlight Investigators
dishonesty and would have quickly dismissed their action against Defendants once they found
that the Joint Report was based on lies and engendering numerous additional lies in discovery.
DOWNEY BRAND LLP
Instead of taking these actions, the Moonlight Prosecutors simply chose not to report what
they were ethically required to report, never disclosing to Defendants or to the Court the gross
inconsistencies between the photographs and sketches, on the one hand, and the Joint Report and
10
deposition testimony on the other. And even worse, the Moonlight Prosecutors made the
11
investigators perfectly comfortable in their lies, as revealed by the pre-deposition meeting where
12
they assured Reynolds that the white flag was a non-issue.41 In the end, the Moonlight
13
Investigators refusal to admit what they had done reflects a profoundly disturbing arrogance and
14
cynicism towards the very purpose of our discovery rules and our legal system in general, as does
15
the Moonlight Prosecutors failure to take action when the Moonlight Investigators repeatedly
16
violated their oath.
17
Critically, the Joint Report was the very foundation of the Moonlight Fire investigation
18
and its subsequent prosecution. There is no more key fact in this matter. And the concealment
19
of the white flag origin in that Joint Report is similarly significant. Indeed, the white flag cover-
20
up means far more than discovering that the most essential point of the investigation was actually
21
at a spot eight or ten feet from the official points of origin, and it means far more than finding that
22
Moonlight Prosecutors were willing to play along. 42 Once an investigation is discovered to have
23
41
24
At that point in time, the Moonlight Prosecutors had already watched White be cross-examined about the white
flag, and could see for themselves that this non-issue destroyed his credibility.
42
25
26
27
28
The Moonlight Investigators deception regarding this central issue is far more meaningful than 10 feet, and it
certainly does not mean that the investigators were 10 feet from being correct. Indeed the plume of smoke shown in
the air attack video demonstrates that the investigators secret point of origin and their fabricated but official points of
origin all existed in an area too far down the slope, roughly 150 to 200 feet from the center of the smoke plume
revealed by an air attack video taken overhead roughly an hour after the fire began. Given their mindset, their error
is not surprising. As these investigators quickly processed the scene, the entire point of that exercise was to pin
blame on chosen defendants, not to find the truth. Thus, because they were not engaged in a scientific exercise they
were way off from where the fire actually started. Once the mindset of these investigators is exposed, it is easy to
59
been infused with dishonesty, it is not about distances or a single point of origin or two. It is
immediately about everything else in the investigation that can no longer be trusted.
DOWNEY BRAND LLP
When the Moonlight Prosecutors chose to advance their prosecution by relying upon the
fraudulent Joint Report and lies of the Moonlight Investigators, they defiled the Court. In this
regard, it is worth noting that some courts and commentators have suggested that perjury should
not usually constitute fraud on the court unless an attorney or other officer of the Court was a
party to it. Stonehill, 660 F.3d at 445 (quoting 11 Wright & Miller, 2870). Here, the lawyers
most certainly were parties to this deception, as they well knew what the Moonlight Investigators
were engaged in a deception, yet they continued to advance the Joint Report and its investigative
10
findings in the litigation through discovery, deposition, and motion practice. The core nature of
11
this fraud, and the gross misconduct it involves, is enough, standing alone, to find a fraud upon
12
the court. See Dixon, 316 F.3d at 1046-47 (finding a fraud on the court based on the actions of
13
two IRS attorneys in covering up relevant evidence, including sitting by silently as witnesses
14
presented testimony the attorneys knew to be false).
15
16
17
2.
The Moonlight Prosecutors Misrepresented to the Court Bushs Alleged

Admission That a Rock Strike Caused the Moonlight Fire, Which They
Relied Upon in Procuring a Favorable Summary Judgment Ruling, Thereby
Committing a Fraud Upon the Court.
The Relevant Facts
18
19
Relying solely on the Joint Report and the Declaration of Joshua White, the Moonlight
20
Prosecutors presented the following as an allegedly undisputed fact in the United States
21
opposition to Defendants motion for summary judgment:
22
23
24
25
26
27
28
171. In a signed statement that Bush submitted to investigators,

he admitted that Crismon was operating in the area closest to the
also imagine that their initial and secret point of origin may not have even been their first point of origin. Since
this matter clearly and convincingly demonstrates a willingness by these investigators to move their point of origin in
a failed effort to strengthen their case, it also demonstrates the distinct possibility that the investigators suppressed
other points of origin as well, that the white-flagged point of origin is not their only other point, but perhaps their
second or third, which they abandoned in favor of a point more connected to their target defendants. Perhaps the
investigators initially placed a completely different point of origin near the area where the plume is shown in the
video, and thought better of it because it implicated the wrong party, a possibility suggested by the testimony of
Sierra Pacific employee Mike Mitzel, who saw another flagged area further up on the ridge a few days after the fire
started.
60
fire and that he believes that Cat tracks scraped rock to cause fire.
White Decl., 6, Ex. A, p. 133.
2
3
4
that the investigating officers interviewed Bush twice. They also misrepresented what Bush said
during those interviews; at no time did Bush state that he believed the bulldozer tracks scraped a
rock to cause the fire. In fact, in his interview with lead Moonlight Investigator White, he
specifically denied having this belief. The Moonlight Prosecutors were aware of these facts when
they presented this allegedly undisputed fact to the Court.
DOWNEY BRAND LLP
In making this representation to the Court, the Moonlight Prosecutors failed to disclose
The first interview was conducted by Moonlight Investigator Reynolds, a law enforcement
10
officer, on September 3, 2007, a little over an hour after the fire was reported from the Red Rock
11
Lookout Tower. That interview was not tape recorded. Consequently, the only record of what
12
Reynolds and Bush purportedly discussed is a federal form titled Statement, which Reynolds
13
completed for Bush to sign at the end of the interview.
14
The form Reynolds filled out asserts that Bush stated that he believes CAT tracks
15
scraped rock to cause fire. Reynoldss summary of the first interview was included in the Joint
16
Report and is the Exhibit referenced by the Moonlight Prosecutors in support of their purportedly
17
undisputed fact.
18
The form Reynolds used calls for a signature by the officer issuing the report and the
19
signature of a witness. Neither signature box is completed on the version of the form included in
20
the Joint Report and relied upon by the Moonlight Prosecutors.
21
Notwithstanding Reynoldss failure to sign the statement and his failure to have a witness
22
present to sign the statement, Bush signed it on a line marked, SIGNATURE OF PERSON
23
GIVING STATEMENT. Bush does not dispute that he signed the form. During his deposition,
24
however, he denied making the statement that he believed the CAT tracks scraped a rock and
25
caused the fire. Plaintiffs challenged Bush on this assertion by pointing out that he had signed the
26
form, which begins with the language, I have read the foregoing statement. In response, Bush
27
grudgingly admitted he cannot read. He further testified that Reynolds tried to persuade him to
28
say that the CAT tracks scraped a rock to cause the Moonlight Fire, but he never made that
61
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statement.
Bushs second interview was conducted one week later by Moonlight Investigator White,
also a law enforcement officer, on September 10, 2007. White tape recorded his interview with
Bush but did not include the recording as part of the Joint Report. Instead, he, like Reynolds,
drafted a document purporting to summarize his conversation with Bush. White included this
summary in the Joint Report. The Cal Fire form used by White does not call for a signature by
the interviewee, so Bushs signature does not appear on this document. White signed it, though,
as the officer completing the summary.
Whites written summary of the second interview falsely attributes to Bush an admission
10
of liability regarding the governments rock strike theory. In particular, as confirmed in the tape
11
recording, White asked Bush whether Bush had ever told Reynolds that he believed the bulldozer
12
scraped a rock and started the Moonlight Fire. Bush flatly denied having done so and further
13
explained that he never thought the fire started in that manner, a fact which the recording of the
14
interview confirms.
15
Nevertheless, Whites written summary of the interview, advanced in the Joint Report
16
and presented by the Moonlight Prosecutors as an undisputed fact, states: Bush reiterated the
17
same information he had provided to I-1 Reynolds.
18
This statement is of course false, as the most important component of Reynoldss written
19
summary of his interview with Bush is the falsity that Bush believed a CAT scraped a rock and
20
started the fire, and one of the most important components of Whites interview with Bush is
21
Bushs statement that he never told anyone what caused the fire and that he did know what had
22
caused it. In other words, Bush never made the statement to Reynolds that he supposedly
23
reiterated to White, and thus the interview reports involve falsities upon falsities.
24
Defendants obtained the tape recording of Whites interview with Bush during discovery.
25
When White was deposed, Defendants confronted him with this contradiction and asked why
26
there was a glaring inconsistency between the tape recording of the interview and the written
27
summary. White could not explain it. Instead, he responded, No. I dont know why. This
28
deposition occurred more than a year before the Moonlight Prosecutors filed the United States
62
summary judgment opposition, and was attended by Taylor, the lead Moonlight Prosecutor at the
time. The deposition also occurred before the Moonlight Prosecutors relied on these falsified
witness summaries in verified discovery responses, signed by Taylor in violation of her duties
under Federal Rule of Civil Procedure 26(g)(1)(A).
DOWNEY BRAND LLP
If White believed Bush was recanting or changing his alleged statements to Reynolds
made in the first interview, White would have interrogated Bush on that issue, asking Bush why
he no longer believed the CAT tracks scraped a rock to cause the fire, when that was what he had
(supposedly) said to Reynolds on September 3. But White did no such thing. Instead, the tape
recording reveals that he remained silent when Bush emphatically stated that he had never said to
10
anyone that he knew what started the fire. White thereafter prepared his falsified written
11
summary of this September 10 interview, and could not explain the contradiction when
12
questioned during his deposition, as the Moonlight Prosecutors sat by and watched. These facts
13
demonstrate that White knew the first written confession by Bush was fabricated by Reynolds,
14
and that Whites interview was simply for the purpose of perpetuating the fraud through a second
15
interview, without any regard for what Bush actually said.
16
17
This misrepresentation was directly relevant to one of the central issues in the case
namely, who started the fire, and how.
18
This Court ruled in favor of the United States and denied Defendants summary judgment
19
motion. The Moonlight Prosecutors never corrected the record before the Court, never withdrew
20
their reliance on Reynoldss inaccurate statement, never disclosed that Whites summary of the
21
second interview intentionally perpetuated the falsity that Reynolds created, and never amended
22
their discovery responses as required by Federal Rule of Civil Procedure 26(e).
23
Judge Nichols recited these facts in finding by clear and convincing evidence that Cal
24
Fires lead investigator falsified Bushs interview statement, and incorporated that falsification
25
into its interrogatory responses.
26
These facts concerning the falsification of the Bush interviews, and the Moonlight
27
Prosecutors misrepresentations to the Court, were generally known to Defendants before the
28
conclusion of the federal action, but this does not preclude relief under Rule 60(d)(3). See Hazel63
Atlas, 322 U.S. at 246 (setting aside a judgment for fraud upon the court notwithstanding the fact
that the parties settled, that the defrauded party did not seek relief until seven years after the
settlement, and that the defrauded party suspected and was actively investigating the fraud at the
time of the settlement).
DOWNEY BRAND LLP
Analysis
Standing alone, the Moonlight Prosecutors actions with respect to the falsified Bush
interviews, and their presentation of those interviews in connection with their successful summary
judgment opposition and verified discovery responses, constitute fraud upon the Court and
warrant relief under Rule 60(d)(3). In furtherance of the type of scheme the Ninth Circuit
10
discusses in Stonehill, the Moonlight Investigators here falsified more than just their original
11
white flagged point of origin. In another effort to sell their fraudulent scheme that a bulldozer
12
started the Moonlight Fire, the undisputed evidence establishes that Reynolds and White each
13
produced a written summary of their respective interviews with Bush, falsely attributing to Bush
14
admissions of liability regarding the governments rock strike theory. Even after Defendants
15
uncovered the falsification of Bushs interviews, prominently displayed in the Joint Report, and
16
even after White could not answer why the tape recording of his interview of Bush conflicted
17
with his written summary, the Moonlight Prosecutors still knowingly advanced in motion practice
18
before this Court the so-called undisputed fact that Bush had admitted liability, and proffered
19
the so-called fact in verified discovery responses.
20
This behavior constitutes fraud on the court. More specifically, the Moonlight
21
Prosecutors submission to the Court and use in discovery of the falsified Bush interviews was
22
an effort by the government to prevent the judicial process from functioning in the usual
23
manner. Stonehill, 660 F.3d at 445. This was not perjury or nondisclosure relating to a
24
tangential issue; instead, it went to the key issue in the case causation and, as such, was so
25
fundamental that it undermined the workings of the adversary process itself. Id.
26
The Ninth Circuit found similar behavior to constitute a fraud on the court in Pumphrey.
27
There, in-house counsel attended trial on the defendant companys behalf, watched an expert
28
witness perjure himself on a key issue, and then watched the same expert perjure himself again in
64
depositions that were taken in subsequent litigation. 62 F.3d at 1132. He also helped prepare
misleading, inaccurate, and incomplete discovery responses, and fail[ed] to correct the false
impression created by [the expert witnesss] testimony. Id. This is exactly what the Moonlight
Prosecutors have done. They attended the depositions of Bush and White, heard Bush deny ever
having told Reynolds that he believed the CAT tracks scraped a rock to cause the fire, listened to
the questions about the discrepancy between Whites interview summary and the tape recording,
and watched as White had no answer for the falsehood he intentionally created. The Moonlight
Prosecutors did not disclose this falsehood to the Court; instead, they took the lies created by the
Moonlight Investigators and relied on them in discovery responses (as the in-house counsel did in
10
Pumphrey), to successfully defeat Defendants motion for summary judgment (just like in
11
Pumphrey, where the in-house counsel allowed the expert witness to testify falsely at trial).
DOWNEY BRAND LLP
12
In their portion of the Joint Status Report, the Moonlight Prosecutors incorrectly state that
13
they made no misrepresentation to the Court, and that the instant motion is not about
14
fabrication of evidence by counsel or anything similar. (Docket No. 612 at 18:6-7.) This
15
assertion is clearly incorrect as evidenced by the Moonlight Prosecutors reliance on the supposed
16
Bush admission within their opposition to Defendants motion for summary judgment. Not only
17
did the Moonlight Prosecutors misrepresent the circumstances of the supposed Bush admission,
18
they undoubtedly wrote, or co-wrote, the Declaration of Joshua White, which attaches the
19
falsified Joint Report, including the falsified Bush interview summaries, and presented them to
20
the District Court. Accordingly, for all the reasons stated above, as well as those stated by the
21
Ninth Circuit in Pumphrey, the Moonlight Prosecutors behavior in this instance constitutes a
22
fraud upon the Court.
23
24
25
26
3.
The Moonlight Prosecutors Proffered False Testimony in Opposition to

Defendants Motion for Summary Judgment and Succeeded in Procuring a
Favorable Ruling, Thereby Committing a Fraud Upon the Court.
The Relevant Facts
The Moonlight Prosecutors proffered to this Court a false and misleading declaration from
27
White and attachments thereto about the investigation of the Moonlight Fire in support of their
28
opposition to Defendants motion for summary judgment. In doing so, they committed a fraud on
65
this Court.
Defendants Sierra Pacific and Howell filed a Motion for Summary Judgment on February
29, 2012. On March 28, 2012, the United States filed its opposition, the centerpiece of which was
a declaration by lead Moonlight Investigator White. (See Docket No. 437.)
In addition to the affirmative misrepresentations and falsehoods by omission in Whites
Declaration, the Moonlight Prosecutors also attached as an exhibit to the declaration virtually all
of the fraudulent Joint Report, thereby presenting it to the Court as evidence in support of their
opposition to Defendants motion.
DOWNEY BRAND LLP
The United States relied upon that declaration and its exhibits to dispute at least twelve
10
material facts proffered by the defense. (Docket No. 435.) Additionally, the United States relied
11
on that declaration and its exhibits to proffer at least twenty-five additional facts that the
12
government contended were material to the Courts ruling on the motion. (Docket No. 435-1.)
13
Whites declaration discusses in detail various tasks that he and Reynolds supposedly
14
undertook as part of their investigation, including the placement of red, yellow, and blue indicator
15
flags. But critically, White omits any mention of the white flag, and omits any mention of his
16
work marking, measuring, photographing, and diagramming the original, undisclosed point of
17
origin denoted by that white flag. White attests that he and Reynolds found small metal
18
fragments near two rocks that we identified as having been struck by heavy equipment, i.e. E-2
19
and E-3. But there can be no question, in view of all the evidence that has been revealed about
20
their actions, that these metal fragments were actually collected at the white flag point of origin
21
the investigators were so desperate to conceal. 43
22
The equally deceptive Joint Report attached to Whites declaration is a study in
23
43
24
25
26
27
28
Defendants are informed and believe that the Moonlight Investigators collected the metal at the white flag rock, not
at rocks E-2 and E-3 as falsely claimed in their Joint Report. Why else would White have placed metal fragments
into a single bag collected from two locations some ten feet apart, in violation of the most basic investigation
methods and his own training? Why else would White and Reynolds have lied about the white flag? Why else
would the rocks E-2 and E-3 have no indicator flags, no evidence tents, no markings, nothing to suggest White found
them relevant in the overview of indicators photographs he took to document all that the Moonlight Investigators
had accomplished at the scene shortly before he released the scene, and roughly a half hour before Reynolds said they
were done? Why else would the only scene diagram on September 5 have distance and bearing measurements that
perfectly triangulate to the white flag and not E-2 or E-3? Why else would White have waited until September 8,
2007, to collect rocks E-2 and E-3, long after he had released the scene three days before?
66
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obstruction of justice. As detailed throughout this supplemental briefing, the Joint Report is
replete with a fabrication regarding the investigation. It conceals the existence of the secret
abandoned point of origin, and perpetuates the fraud associated with the belatedly manufactured
points of origin. The Joint Report, and Whites Declaration, also attach and incorporate
numerous falsified witnesses statements and witness interview summaries, all manufactured in
aide of this corrupt and tainted prosecution. All of these documents were attached to and
presented to this Court by the Moonlight Prosecutors for its careful consideration in ruling on
Defendants motion for summary judgment.
As discussed, supra, White discusses the alleged Bush confession which he also
10
attaches as part of the Joint Report. The Moonlight Prosecutors were present for Whites
11
deposition on that subject. There, they saw firsthand Whites inability to explain why he wrote in
12
his interview summary the exact opposite of what Bush said, as the recording of the interview
13
reveals.
14
Whites declaration also attaches the fraudulent interview summaries of the USFS
15
personnel staffing the Red Rock Lookout Tower. These falsified official forms were prepared by
16
Whites co-investigator Special Agent Welton. As explained in more detail, infra, these false
17
statements are written so as to conceal the most important events that transpired at the Red Rock
18
Lookout Tower in the minutes before the fire was reported. Under 18 U.S.C. section 1519,
19
falsifying any record with the intent to impede, obstruct or influence an investigation constitutes
20
an obstruction of justice. Having attended and defended all pertinent depositions regarding the
21
events that transpired at the Red Rock Lookout Tower, the Moonlight Prosecutors knew or should
22
have known that these aspects of the Joint Report they elected to present to the Court were works
23
of fiction and that they constituted efforts to obstruct justice.
24
The Moonlight Prosecutors did nothing to bring these serious issues to the Courts
25
attention or address them in any way, and instead exacerbated them by filing falsified witness
26
interviews with the Court and relying upon them in support of their opposition to the defense
27
motion for summary judgment.
28
At the time that the Moonlight Prosecutors filed Whites declaration with the Court, they
67
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knew that the Moonlight Investigators concealed and suppressed their work relating to the white
flag from the Joint Report, and that they testified falsely about the white flag in their depositions.
Indeed, by that point in time, the Moonlight Prosecutors had already participated directly or
indirectly in seventeen days of Whites deposition. The Moonlight Prosecutors had already
conducted their now infamous meeting with Reynolds to discuss the white flag, where they
reviewed enlarged photos of it on a video screen while brazenly telling him it was a non-issue
in preparation for Reynoldss deposition. The Moonlight Prosecutors had already participated
directly or indirectly in four days of Reynoldss deposition, during which Reynolds had been
examined about his secret scene sketch and claimed to be unable to see the white flag despite
10
the fact that he had earlier discussed this flag with the Moonlight Prosecutors as being a non-
11
issue and viewed pictures of it on a video screen. The Moonlight Prosecutors had also, by that
12
point in time, been present at all of the depositions that were the subject of Judge Nichols orders,
13
wherein he found by a clear and convincing evidence standard that the Moonlight Investigators
14
had repeatedly given false testimony, and specifically found that Reynolds did not testify
15
honestly.44
16
In addition to the Moonlight Investigators false testimony, by the time that the Moonlight
17
Prosecutors filed Whites declaration with the Court, these government attorneys had also heard
18
testimony from their own surveying expert confirming that the distance and bearing
19
measurements on the sketch Reynolds prepared with a single point of origin intersected exactly at
20
the location of the white flag.
21
Whites declaration and the Joint Report attached thereto also contained the falsified
22
reports of three other fires, namely the Greens Fire, the Lyman Fire, and the Sheep Fire. As set
23
forth in greater detail below, these reports were equally specious, and contained equally
24
fraudulent conclusions. The Moonlight Prosecutors attended all of the depositions concerning the
25
reports of these other fires, and thus had no good faith basis to rely upon these reports. Rather,
26
27
28
44
Specifically, Judge Nichols found: [I]t is this Courts responsibility to review whether Cal Fire abused the legal
process through the false testimony of its lead investigator on the Moonlight Fire, White. This Court finds that Cal
Fire, through White, repeatedly did so.
68
they had every reason to understand exactly what they were: fraudulent materials designed to
buttress charges against affluent defendants.
3
4
Prosecutors had proffered a false declaration of a law enforcement officer, but this does not
preclude relief under Rule 60(d)(3). See Hazel-Atlas, 322 U.S. at 246 (setting aside a judgment
for fraud upon the court notwithstanding the fact that the parties settled, that the defrauded party
did not seek relief until seven years after the settlement, and that the defrauded party suspected
and was actively investigating the fraud at the time of the settlement). However, that knowledge
does not excuse the actions of the Moonlight Prosecutors in submitting Whites declaration to the
10
DOWNEY BRAND LLP
Defendants knew prior to the settlement of the federal action that the Moonlight
Court, nor excuse their failure to withdraw or correct that pleading.
11
Analysis
12
The Moonlight Prosecutors advanced the fraudulent investigation into the judicial
13
proceedings by submitting the false and misleading White declaration and Joint Report as part of
14
summary judgment practice. When these government attorneys chose to advance their
15
prosecution by relying upon the corruption at the heart of the investigative work, they engaged in
16
a scheme to change the story as presented to the district court. Stonehill, 660 F.3d at 452.
17
Indeed, Judge Nichols, after discussing the white flag and just how incredible the investigators
18
testimony was on the most central issues in this case indeed, on the very basis upon which this
19
action was brought, also discussed a declaration White submitted in the state action, stating: the
20
Court also finds that Whites . . . declarations to this Court, wherein he repeated and advanced the
21
absurdity of his deposition testimony regarding the white flag in effort to avoid the consequences
22
of his actions, are also an affront to this Court, as is Cal Fires counsels willingness to allow such
23
a declaration to be filed. Of course, even if the Moonlight Prosecutors had not submitted
24
Whites declaration to the Court, but rather had submitted only the Joint Report created by White,
25
that alone would be sufficient to find a fraud on the court, given that the Joint Report was also rife
26
with Whites fraud. Cf. Shaffer, 11 F.3d at 460 (finding fraud on the court when EPA
27
administrative record created by witness who lied about credentials was submitted in support of
28
summary judgment motion, even though EPA did not submit declaration of that witness). Their
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conduct therefore constitutes fraud on this Court.

Hazel-Atlas is instructive because of its parallels to this action. In that case, Hartford
attorneys created a bogus trade journal article, which they submitted in support of a patent
application. 322 U.S. at 240. Similarly here, the Moonlight Prosecutors created the bogus White
declaration and attached to it the fraudulent Joint Report, which they submitted in opposition to
the summary judgment motion. In Hazel-Atlas, Hartford attorneys conceived of the article in
an effort to persuade a hostile Patent Office to grant their patent application, id. at 247, while
here the Moonlight Prosecutors conceived of the White declaration in an effort to persuade this
Court to deny the defense motion for summary judgment. And, as in Hazel-Atlas, where the
10
appellate court cited the fraudulent trade journal article in its decision, id. at 240-41, the Court
11
here cited the fraudulent White declaration repeatedly in its order on the summary judgment
12
motion.
13
Notably, in Hazel-Atlas, the Supreme Court rejected the argument advanced by the
14
Hartford attorneys that their submission did not constitute fraud on the court because the article
15
was not basic or the primary basis for the appellate decision. Id. at 246-47. The Supreme
16
Court noted that the Hartford attorneys thought the article material, id. at 247, just as the
17
Moonlight Prosecutors thought the White declaration and attached Joint Report were material, as
18
evidenced by the fact that they relied upon that declaration to dispute at least twelve material facts
19
proffered by the defense, as well as to proffer at least twenty-five additional facts that the
20
government contended were material to the summary judgment motion. In Hazel-Atlas, the
21
Supreme Court found it sufficient that the Hartford attorneys urged the article upon . . . [the
22
appellate court] and prevailed. Id. Likewise, the Moonlight Prosecutors urged the White
23
Declaration and the attached Joint Report upon this Court and prevailed. That being the case, the
24
Moonlight Prosecutors are in no position to now dispute its effectiveness. Id. The Moonlight
25
Prosecutors conduct, while similar to that of the Hartford attorneys, is all the more egregious in
26
view of their status as government representatives who have a duty to see that justice is done.
27
Berger, 295 U.S. at 88.
28
As with the alleged Bush admission and associated documents proffered to the Court, the
70
Moonlight Prosecutors creation of and presentation to the Court of the false White Declaration
and the Joint Report belies their assertion in the Joint Status Report that they made no
misrepresentation to the Court, and that the instant motion is not about fabrication of evidence
by counsel or anything similar. (Docket No. 612 at 18:6-7.) The evidence clearly and
convincingly establishes that they did so repeatedly, just as Judge Nichols concluded that their
joint prosecution partners had done when proffering the same evidence in the context of the state
action.
4.
DOWNEY BRAND LLP
10
The Moonlight Prosecutors Failed to Take Remedial Action After Learning of

Evidence that Undermined the Governments Origin and Cause Conclusions
and Failed to Produce Related Exculpatory Evidence, Thereby Committing a
Fraud Upon the Court.
11
The Relevant Facts
12
The Air Attack video is an important piece of evidence undermining the Moonlight
13
Investigators conclusions about the origin and cause of the Moonlight Fire. Although the
14
Moonlight Prosecutors disclosed this critical video during discovery, they failed to take any
15
remedial action to correct the Joint Report, their discovery responses, or deposition testimony
16
when expert analysis revealed that the video dispelled their origin and cause theory.
17
Additionally, the Moonlight Prosecutors failed to disclose expert evidence associated with the
18
video that would have shed light on a significant problem with their origin determination.
19
The Air Attack video was taken by a pilot flying over the scene at approximately 3:09
20
p.m. on September 3, 2007. The aerial video shows the Moonlight Fire, still in its infancy,
21
approximately an hour and a half after the fire had allegedly transitioned from an incipient to a
22
free burning state.45 The video shows a large smoke plume on the hillside where the Moonlight
23
Fire began and the fire advancing generally towards the northeast:
24
45
25
26
27
28
The timing of the ignition of the Moonlight Fire is a hotly disputed issue. The government contends that Crismon
started the Moonlight Fire at around 12:15 p.m. when his bulldozer ran over a rock. However, no smoke was spotted
until more than two hours later, at approximately 2:24 p.m. Defendants contend that this significant lag time
suggests that the fire started later and due to a different cause. Faced with the timing discrepancy, the Moonlight
Prosecutors advanced the theory that the Moonlight Fire began as a smolder, remained in an incipient state for an
hour and half, and then allegedly transitioned into a free burning state, at which point the fire actually took off
and produced enough smoke to be spotted. According to the Moonlight Prosecutors, the fire began free burning
around 1:45 p.m.
71

1
2
3
4
5
6
7
8
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Importantly, the Air Attack video shows that the smoke plume from the Moonlight Fire is
located up the hill and to the west of the location where the Moonlight Investigators contend the
10
fire started. The video demonstrates that the alleged points of origin are not in the smoke, but
11
located downhill among unburned trees. The importance of this evidence cannot be overstated.
12
The fact that the alleged points of origin are not in the smoke, and that the fire had not yet reached
13
that area despite the fact that the fire had been burning for approximately an hour and a half,
14
demonstrates that the Moonlight Fire did not start where the government contends.
15
The Air Attack video therefore severely undermines the Moonlight Investigators origin
16
conclusion. Importantly, the video also undermines their conclusion regarding the cause of the
17
Moonlight Fire. In the field of fire investigation, locating the correct point of origin is critical to
18
determining the correct cause of the fire. Natl Fire Protection Assn 17.1 (Generally, if the
19
origin of a fire cannot be determined, the cause cannot be determined.). The Moonlight
20
Prosecutors primary origin and cause expert testified that incorrectly locating the point of origin
21
by even eight feet can make a world of difference because, without a correct origin, an
22
investigator cannot identify the correct ignition source and thus cannot identify the correct cause.
23
The Moonlight Prosecutors were keenly aware of the location of the governments alleged
24
origin in the Air Attack video due to the work of their retained expert, Christopher Curtis
25
(Curtis), a civil engineer and land surveyor jointly retained by the federal and state prosecutors
26
under their Joint Prosecution Agreement. Among other things, the Moonlight Prosecutors
27
retained Curtis to identify the precise location of the alleged points of origin within specific
28
frames of the Air Attack video. The Moonlight Prosecutors hoped this identification would show
72

1
the alleged points of origin near the center of the plume of smoke in the video, and therefore
support the Moonlight Investigators origin and cause conclusions. Curtis performed this
assigned task, placing a red dot in certain video frames to denote the governments origin.
Critically, Curtiss work revealed that red dot to be at a location on the hillside outside the smoke,
underneath the unburned trees standing east and downhill from the smoke plume.
6
7
8
9
10
11
DOWNEY BRAND LLP
12
13
14
15
Defendants also asked their own experts to locate the two alleged points of origin in the
16
Air Attack video. The defense work produced similar results to that of Curtis, resulting in the
17
placement of the alleged origin outside the smoke, underneath unburned trees. Defendants
18
disclosed these expert reports and findings to the United States. Therefore, not only were the
19
Moonlight Prosecutors aware of the significant problem with their alleged origin through the
20
work of their own disclosed expert, Curtis, but through defense expert reports too.
21
The Moonlight Prosecutors also knew or should have known of the significance of the Air
22
Attack video and the related expert analysis. The Air Attack video clearly demonstrates that the
23
Moonlight Fire had not yet reached the governments chosen origin despite allegedly having been
24
in a free burning state for at least an hour and a half. The only logical conclusion from this
25
evidence is that the fire did not start where the government contends it did. Nevertheless, the
26
Moonlight Prosecutors took no remedial action to correct the Joint Report, discovery responses,
27
or deposition testimony regarding their flawed point of origin. Instead, the Moonlight
28
Prosecutors continued to advance this untenable theory in discovery responses, through
73
deposition testimony, and in expert reports and analysis, all conducted under the purview of this
Courts authority.
DOWNEY BRAND LLP
Defendants knew of the Air Attack video and the related expert analysis prior to the
federal settlement, but this does not preclude relief under Rule 60(d)(3). See Hazel-Atlas, 322
U.S. at 246 (setting aside a judgment for fraud upon the court notwithstanding the fact that the
parties settled, that the defrauded party did not seek relief until seven years after the settlement,
and that the defrauded party suspected and was actively investigating the fraud at the time of the
settlement). However, after the federal settlement, Defendants learned that the Moonlight
Prosecutors failed to disclose certain exculpatory evidence associated with the Air Attack video.
10
Specifically, the government attorneys did not provide Defendants with the handwritten notes
11
created by their expert, Larry Dodds, a fire origin and cause expert jointly retained by the federal
12
and state prosecutors under their Joint Prosecution Agreement. Defendants deposed Dodds first
13
in the federal action, and after the federal settlement, again in the state action. In his later state
14
deposition, Dodds produced handwritten notes that he prepared while he was retained as an expert
15
in the federal action, but which the Moonlight Prosecutors had never produced or disclosed to
16
Defendants. The notes reveal that Dodds struggled in consultation with the Moonlight
17
Prosecutors to reconcile the location of the governments alleged origin with the Air Attack
18
video, particularly joint federal/state expert Curtiss placement of the alleged origin in the video
19
frames.
20
For example, in his handwritten notes, Dodds writes: Chris Curtis testified to separation
21
between the GAO [governments alleged origin] & the smoke seen in the AA [Air Attack]
22
video. Dodds confirmed during his state deposition that these notes reflect his understanding of
23
Curtiss federal testimony. When questioned in the state action about this note, Dodds admitted
24
that during a meeting with the Moonlight Prosecutors, Curtis discussed his opinion about the
25
separation between the smoke and the governments origin.
26
Also during the state action, and after the federal settlement, Dodds produced for the first
27
time another handwritten note he claimed he created during the pendency of the state action
28
relating to Curtiss testimony. Therein, Dodds wrote that Curtiss opinion was not only that the
74
Moonlight Investigators alleged origin was not in the smoke, but that this alleged origin had not
burned yet and that Dodds was trying to square Curtiss opinion with the Moonlight
Investigators alleged origin. Dodds conceded during his state deposition that if the governments
alleged origin had not yet burned when the Air Attack video was taken, it would negate the
whole governments origin area.
DOWNEY BRAND LLP
Analysis
The Moonlight Prosecutors conduct with respect to the Air Attack video provides another
unfortunate example of their willingness to ignore their solemn obligation to ensure that justice
shall be done and instead improperly focus on trying to win . . . [the] case. See Berger, 295
10
U.S. at 88. It is another striking example of fraud on the court. In that regard, Pumphrey is
11
informative because of the strong parallels between the conduct of the general counsel in that case
12
and the conduct of the Moonlight Prosecutors in this action.
13
In Pumphrey, general counsel was aware based on in-house testing that a handgun could
14
fire when dropped, and yet allowed trial counsel to advance the theory that the gun would not do
15
so. 62 F.3d at 1131-32. Similarly here, the Moonlight Prosecutors were aware, based on the Air
16
Attack video, that their alleged origin was not correct, or at the very least, subject to extreme
17
doubt, and yet they actively advanced and advocated their flawed origin and cause theory
18
throughout the litigation. Additionally, in Pumphrey, general counsel proffered discovery
19
responses that mischaracterized the gun testing and denied any record of the test in which the gun
20
fired, id. at 1131-32, just as the Moonlight Prosecutors proffered discovery responses and
21
declarations in motion practice that advanced the governments flawed origin analysis.
22
Moreover, in Pumphrey, general counsel allowed a company employee to create a false
23
impression during his deposition about the gun testing, id. at 1132, just as the Moonlight
24
Prosecutors allowed its investigators and experts to create a false impression in their depositions
25
about the location of the origin and false impression about the accuracy of the initial
26
investigation. And, in Pumphrey, general counsel did not facilitate the production of a video of
27
the testing in which the gun fired, id. at 1131, while similarly the Moonlight Prosecutors did not
28
facilitate the production of notes taken by their expert that highlighted the flaws in the
75
governments origin location. Standing alone, this conduct constitutes fraud upon the Court and
warrants relief under Rule 60(d)(3).
3
4
5.
The Moonlight Prosecutors Created a False Diagram to Further Their Case,

Thereby Committing a Fraud Upon the Court.
The Relevant Facts
DOWNEY BRAND LLP
5
6
After learning that the location of the governments origin in the Air Attack video was
outside the smoke, the Moonlight Prosecutors did not attempt to correct the record, but instead
conceived a plan to create new evidence to salvage their flawed origin. As part of that effort, the
Moonlight Prosecutors knowingly and deliberately proffered a false diagram of the directional
10
spread of the fire from the alleged origin. This diagram squarely contradicted the official sketch
11
in the Joint Report, the sworn deposition testimony of Moonlight Investigator Reynolds, and the
12
Air Attack video.
13
The Joint Report includes an official sketch depicting the Moonlight Investigators alleged
14
points of origin and diagraming the spread of the fire from those points. As this sketch reflects,
15
the Moonlight Investigators hypothesized that the fire advanced downhill and to the northeast of
16
their chosen origins. During his deposition, Reynolds confirmed this theory, testifying that he
17
and White were in agreement that the fire moved downhill, northeast from the alleged origin.
18
Long after the publication of the Joint Report and its official sketch, the experts analyzed
19
the Air Attack video and pinpointed the alleged origin. The Air Attack video does indicate that
20
the Moonlight Fire advanced to the northeast as Reynolds testified; however, the video also
21
reveals that the fire could not have started at the alleged origin and then spread northeast,
22
because the smoke plume (and thus the fire) is located to the northwest of the alleged origin,
23
while to the northeast of the alleged origin are green, unburned trees. See picture, supra.
24
Rather than admit that the Moonlight Investigators had wrongly identified the origin, the
25
Moonlight Prosecutors embarked on a mission to manufacture new evidence, attempting to
26
explain the discrepancy between the location of their origin and the smoke in the Air Attack
27
video. The Moonlight Prosecutors directed Curtis to create a brand new scene diagram, one that
28
76
re-plotted the location of the alleged points of origin and re-diagramed the spread of the fire.46 At
their behest, Curtis created a new diagram that dramatically altered the direction of the advancing
fire. The new diagram showed the fire spreading up the hill to the northwest. This new diagram,
and its uphill, northwest advancement, are contrary to the official sketch in the Joint Report, the
sworn testimony of Reynolds, and the Air Attack video, all of which indicate a downhill,
northeast spread. Thus, the Moonlight Prosecutors changed the direction of the advancing fire by
a full ninety degrees.
DOWNEY BRAND LLP
After the creation of this new diagram, White unveiled it mid-deposition and testified
about it extensively. Deposition testimony establishes that this directional change was not done
10
to correct a careless drafting error on the official sketch in the Joint Report. In fact, during her
11
deposition, Welton testified that co-Moonlight Investigator White took a particular interest in the
12
precise placement of the north compass on the official sketch, and that White even instructed her
13
to revise and to slightly cant their north arrow to the left so as to improve its accuracy before
14
finalizing the official sketch and to make clear the fire advanced to the northeast.
15
Notwithstanding the care that went into the original placement of the northeast advancing
16
indicators, the Moonlight Prosecutors facilitated the creation of the new diagram since the old one
17
could not withstand critical scrutiny and could not be reconciled with the Air Attack video.
18
Analysis
19
The conduct of the Moonlight Prosecutors with respect to the false fire spread diagram
20
was not only a violation of their heightened ethics as representatives of our government, but it
21
was also similar to the conduct at issue in Derzack, 173 F.R.D. 400. In that case, the plaintiffs
22
produced falsified documents to the opposing party during discovery and then proffered
23
deposition testimony about those documents and related facts, thereby committing a fraud upon
24
the court. Id. at 404; see also Hazel-Atlas, 322 U.S. at 245 (finding a fraud upon the court based
25
on manufactured evidence). Similarly here, the Moonlight Prosecutors directed the creation of a
26
scene diagram that was conceived years after the origin and cause investigation concluded, and
27
46
28
Curtis testified that counsel from the state and from the federal government, along with consultant Carlson, came
to his office before Christmas in 2010 and asked me if I could do this [diagram].
77
that completely departed from the official scene sketch prepared during the investigation, as well
as the sworn deposition testimony of Reynolds and the indisputable Air Attack video. In so
doing, the Moonlight Prosecutors manufactured evidence in an effort to salvage the Moonlight
Investigators faulty origin determination, and purposefully injected that evidence into the
discovery process in an effort to win at all costs. This conduct is a clear scheme to change the
story as presented to the district court. Stonehill, 660 F.3d at 452. Standing alone, this conduct
also constitutes fraud upon the Court and warrants relief under Rule 60(d)(3).
8
9
10
DOWNEY BRAND LLP
11
6.
The Moonlight Prosecutors Failed to Disclose and Correct Admittedly False

Expert Reports Thereby Committing a Fraud Upon the Court.
The Relevant Facts
The Moonlight Prosecutors failed to disclose to the defense a serious error in a report
12
prepared by their expert Kelly Close (Close) regarding the directional spread of the fire. When
13
confronted with this error, Close testified that he made the Moonlight Prosecutors aware of this
14
mistake, leaving no doubt that they were aware of the problem and that they purposefully chose
15
not to take corrective action. Had the Moonlight Prosecutors corrected this mistake, Closes
16
report would have undermined the governments origin theory and provided additional proof that
17
the fire did not start where the Moonlight Investigators and Prosecutors contended it did.
18
As relevant to this issue, the Moonlight Prosecutors retained Close, a fire spread behavior
19
specialist who, among other things, purported to model the fire spread using software known as
20
FARSITE. To perform this modeling, Close entered certain data into FARSITE, including the
21
surrounding terrain, wind, and fuel loads. When Close eventually produced his FARSITE
22
modeling to Defendants, it showed the fire initially advancing from the alleged origin to the west,
23
directly towards the smoke plume seen in the Air Attack video. From this FARSITE modeling,
24
the Moonlight Prosecutors were able to suggest that their alleged points of origin were correct,
25
notwithstanding the Air Attack video, and that the fire burned uphill to the west, rather than
26
downhill to the northeast, as depicted on the official sketch and as testified to by Reynolds.
27
28
Through tremendous cost and effort, Defendants discovered that Close made an egregious
error in his FARSITE modeling, one that had a significant effect on the direction of the fire
78

1
spread in his model. Specifically, instead of correctly inputting the actual nine degrees of slope
of the hillside in the area of the fire, Close inputted thirty-three degrees.47 The magnitude of this
error is apparent from the following demonstrative, which compares the actual slope (in blue) to
Closes slope (in red).
5
6
7
8
9
10
11
Defendants did not learn of this error through a disclosure by the Moonlight Prosecutors,
DOWNEY BRAND LLP
12
13
or through a corrected expert report from Close. Instead, Defendants fire modeling expert Dr.
14
Christopher Lautenberger (Lautenberger) discovered the error only after carefully sifting
15
through the data that Close produced. Lautenberger re-ran the FARSITE modeling using a
16
corrected data set, including the correct nine degree slope. The results of Lautenbergers
17
modeling revealed a fire spread generally to the northeast not to the west consistent with the
18
Air Attack video. These facts tended to prove that the fire did not start where the Moonlight
19
Investigators and Prosecutors claimed, and that it actually started farther up the hill.
20
In light of Lautenbergers work and his discoveries, Defendants were eager to take
21
Closes deposition, which occurred on March 5, 2012. While Lautenbergers supplemental report
22
revealed that Defendants were aware of Closes incorrect slope input before the deposition began,
23
Close nevertheless began by testifying that he had no changes to make to his report.
24
In light of the severity of his slope input error, defense counsel pressed the issue, asking
25
him, Do you understand that if in fact you think you found a mistake, that you are obligated to
26
27
28
47
As fire behaviorists and investigators recognize, slope has a tremendous impact on the rate and direction of fire
spread. Fires will burn faster uphill than downhill because of the preheating of the uphill fuels and the influence of
upslope and up-canyon winds.
79
DOWNEY BRAND LLP
make changes to your report?48 Assistant United States Attorney Richard Elias objected to this
line of questioning, accusing defense counsel of misstating the law and instructing the witness
not to speculate.
After a lengthy back-and-forth, and in a moment of understatement, expert witness Close
finally admitted that there was an error in specifically a slope map error that I used for inputs in
the FARSITE . . . that caused some of the slope values to be somewhat exaggerated in some parts
of the terrain that I was examining.
When defense counsel asked Close if he had taken any steps to correct his report, Close
testified that he brought the error to the attention of the Moonlight Prosecutors. The Moonlight
10
Prosecutors were therefore aware that Closes report contained significant errors and yet they did
11
nothing to correct the record.49
12
Close also testified that he had considered making changes but ultimately did nothing to
13
correct his report. Close did testify, however, that after realizing his mistake he went back into
14
his models, fixed the slope error, and allegedly for his own edification re-ran the model. Close
15
claimed that his modeling results with the corrected slope were very similar. This assertion,
16
however, is completely unsubstantiated. The Moonlight Prosecutors allowed him to keep the
17
results of his corrected work private and never provided those results or the underlying data to
18
Defendants. And, contrary to Closes assertion, Lautenbergers work proved that modeling with
19
the correct slope and with Closes incorrect slope produced dramatically different results in the
20
fire spread direction.50
21
48
22
23
24
Under Rule 26(a)(2)(E), as expressly informed by Rule 26(e)(1), A party who has made a disclosure under Rule
26(a) or who has responded to an interrogatory, request for production, or request for admission must
supplement or correct its disclosure or response: (A) in a timely manner if the party learns that in some
material respect the disclosure or response is incomplete or incorrect, and if the additional or corrective
information has not otherwise been made known to the other parties during the discovery process or in writing. Fed.
R. Civ. P. 26(e)(1)(A) (emphasis added).
49
25
26
27
28
Of course, a properly focused prosecutor would have quickly discussed the error with the expert, discussed the
need to be careful with such important data sets, and immediately instructed the expert to comply with Rule 26 and
correct the report as soon as possible. Not here.
50
It appears Taylor wanted to attack Lautenbergers work through her expert Curtis. Curtis testified that he was
asked to do some filming from a helicopter and was asked to give opinions on certain experts, one of which was
Lautenberger. He testified that Ms. Taylor asked if I could rebut Lautenberger and I wouldnt do it. (Ex. 54 at 1617.)
80
DOWNEY BRAND LLP
The Moonlight Prosecutors repeatedly demonstrated their willingness to prepare and
submit false discovery responses on other fronts; to actively facilitate false testimony regarding
the most important aspects of the investigation; to misrepresent to the court the state of critical
evidence; and to willfully and intentionally conceal the state of that critical evidence. In light of
these facts, Defendants are informed and believe that if required to testify truthfully, Close would
concede that the Moonlight Prosecutors instructed him not to correct his erroneous expert report,
and further instructed him not to create any permanent record of his corrected fire modeling,
because to have done so would have created evidence that, while truthful, would have been
extremely favorable to Defendants.51
10
Analysis
11
Before the deposition of government expert Close, the Moonlight Prosecutors were
12
acutely aware that he had used the egregiously invalid 33 degree slope input (more than triple the
13
actual slope) and yet they did nothing to disclose his mistake or correct his report as required
14
under Rule 26(e). Thereafter, one of the lead Moonlight Prosecutors sat on his hands while Close
15
testified at his deposition that he had nothing to correct in his original expert report. That the
16
Moonlight Prosecutors knowingly allowed Close to conduct additional fire modeling
17
experimentation using the correct slope input data for his edification, while discarding, or
18
allowing Close to discard, the output of those experiments makes this abuse that much worse.
19
Addressing a similar issue, the Ninth Circuit in Pumphrey found that the purposeful concealment
20
of experimental results that controvert or call into question the reliability of produced results was
21
sufficient to support a finding of fraud upon the court. See 62 F.3d at 1130-31. Accordingly, the
22
Moonlight Prosecutors malfeasance with respect to the use of false slope inputs by Close
23
separately constitutes fraud upon the Court and warrants setting aside the judgment under Rule
24
60(d)(3).
25
26
27
28
51
Closes error was so harmful to the governments case that Cal Fire elected not to disclose Close as one of its
retained experts in the state action, even though it used no less than eleven other experts whom the United States had
also used.
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2
7.
The Moonlight Prosecutors Misrepresented Evidence to the Court to

Wrongfully Claim that Howell Started Other Wildland Fires to Procure
Another Favorable Ruling on Summary Judgment, Thereby Committing a
The Relevant Facts
DOWNEY BRAND LLP
The Moonlight Fire litigation was not about only one fire. It was, in fact, a lawsuit
premised on four fires because the Moonlight Prosecutors Complaint alleged that Howell was
responsible for negligently causing three other fires in 2007, two before and one shortly after the
Moonlight Fire occurred. The Moonlight Prosecutors relied on these three other fires as support
for their negligent hiring and negligent supervision/retention claims.
10
One of the other fires was investigated solely by the USFS, and two of the other fires were
11
investigated solely by Cal Fire. The investigations of all three of these other fires were completed
12
in a rush to shore up White and Reynolds work on Moonlight, and like the Moonlight
13
investigation, they were fraudulent and lack scientific integrity.
14
The Moonlight Prosecutors made misrepresentations to the Court in their trial brief and
15
their summary judgment opposition regarding these fires. The Moonlight Prosecutors represented
16
to the Court in their trial brief:
17
18
19
20
21
22
23
24
25
26
27
All the defendants should have foreseen the [Moonlight] fire,

because Howells had already started two other fires earlier that
summer while performing similar work for Sierra Pacific with
bulldozers, and W.M. Beaty, Howells, and Sierra Pacific all
learned of those fires weeks before the Moonlight Fire.
At the time they submitted this statement to the Court, the Moonlight Prosecutors were
aware that the investigations into these three other fires were fraudulent.
The Greens Fire
The Greens Fire broke out on June 21, 2007, about a mile west of where the Moonlight
Fire eventually started, on property owned by the Landowner Defendants, managed by W.M.
Beaty, and harvested by Sierra Pacific through its contractor, Howell. The fire burned
approximately one quarter of an acre and generated $4,500 in suppression costs a relatively
nominal amount which the United States never attempted to collect.
28
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2
cause investigation. Although Foster conducted a perfunctory investigation on June 21, 2007,
Foster did not submit an origin and cause report until September 8, 2007, five days after the
Moonlight Fire began and only then at the specific request of Investigator Reynolds. Fosters
delayed report blames Howell for causing the Greens Fire. It concludes that, like Moonlight, the
fire began as a result of one of Howells bulldozers striking a rock.
Notably, the Greens Fire report surfaced just after the Moonlight Fire ignited, despite
Fosters confirmation during her deposition that the USFS requires investigators to complete
origin and cause reports within two weeks of a fire. When defense counsel asked Foster why she
10
11
DOWNEY BRAND LLP
The USFS sent forestry technician Brigitte Foster (Foster) to conduct an origin and
failed to comply with the two-week deadline, she had no answer.

Curiously, Foster claimed to have submitted a single-page excerpt of the report in July
12
2007 under her married name, Foster, and then, in the section designated for her supervisors
13
signature (signifying the supervisors approval of the report), Foster filled in her maiden name,
14
Boysen. This gave the appearance that Foster had properly submitted her report and that it had
15
been approved by a supervisor, when in fact neither of these things occurred. In her deposition,
16
Foster could give no explanation for this apparent act of deception, simply stating, I dont know
17
why I . . . put Approved by Boysen.
18
During her deposition, which Taylor defended as the lead Moonlight Prosecutor, Foster
19
testified that she never located a point of origin or even a specific area of origin. Foster also
20
admitted in her deposition that she did not find an ignition source for the Greens Fire.
21
Under the fire investigation standards, Fosters failure to find the point of origin should
22
have resulted in a finding that the fires cause was undetermined. Joint federal and state origin
23
and cause expert Larry Dodds confirmed under oath that it is almost always the case that an
24
investigator must find a point of origin before he or she can make a conclusion about a fires
25
cause. Dodds also confirmed that to identify the origin and cause of a fire, the investigator must
26
locate a competent ignition source and find where that competent ignition source came into
27
contact and ignited a fuel. With respect to the Greens Fire origin and cause report, not only did
28
Foster fail to find a point of origin, she failed to locate the far broader specific area of origin as
83
well as any ignition source. Thus, according to the United States own expert, she should have
listed the cause of the Greens Fire as undetermined.
DOWNEY BRAND LLP
Fosters deposition testimony presented additional problems with the Greens Fire origin
and cause report. She testified that she saw rock strikes but took no photographs of them and
could not explain why she failed to do so. Foster was unable to say whether there were 100 rock
strikes or only two. Foster also testified, strangely, that although she had a magnet with her, she
made no effort to search for metal as a potential ignition source because the area was disturbed
and I didnt feel the need to pull out the magnet. When asked whether she thought the fire was
caused by a fragment that came off a Caterpillar, Foster paused and could only say possibly.
10
Finally, while accepted scientific methodology required her to test her claimed hypothesis, Foster
11
admitted that she failed to do so. In the face of these investigative failures, Fosters report
12
concludes, inexplicably, that Howell caused the Greens Fire.
13
14
15
As a consequence of hearing Foster testify to these facts, Taylor had actual knowledge
that there was no basis whatsoever to conclude that Howell caused the Greens Fire.
There are additional irregularities with regard to the Greens Fire investigation and the
16
origin and cause report of which the Moonlight Prosecutors were well aware. While Foster
17
testified that Damon Baker was the Howell employee responsible for starting the Greens Fire, a
18
year later the Moonlight Prosecutors prepared and filed a sworn declaration from White stating
19
that Howells employee Bush admitted to starting the Greens Fire.
20
Additionally, when the Moonlight Prosecutors produced the Greens Fire origin and cause
21
report during litigation, Foster created an entirely new version of the report, which differed
22
significantly from the original. Foster conceded that she manufactured a new report from
23
memory and submitted it as the actual report for purposes of producing the document in
24
discovery. Among other things, Foster manufactured a new scene sketch, photo descriptions, and
25
incident report, all of which differed substantively from the original report. By falsifying a police
26
report, Foster arguably committed a felony.
27
28
After Fosters deposition occurred and the Moonlight Prosecutors were on notice that the
Greens Fire origin and cause report was falsified, fraudulent, and unsupportable according to their
84
own experts testimony, they still violated their duty of candor and elected to rely on this
document in support of various claims they made to the Court. In their trial brief, the Moonlight
Prosecutors specifically relied on Fosters theory that Howell caused the Greens Fire as support
for their negligent supervision claim. They also successfully opposed Defendants motion for
summary judgment and argued, in part, that Howell was responsible for starting the Greens Fire.
And, as with so many other instances of discovery abuse, the Moonlight Prosecutors relied on
Fosters fraudulent report in support of numerous discovery responses they provided to
Defendants.
The Lyman Fire
DOWNEY BRAND LLP
10
Like the Greens Fire, the August 17, 2007, Lyman Fire broke out before the Moonlight
11
Fire. It burned approximately three acres of Sierra Pacifics property in Tehama County. As was
12
the case with the Greens Fire, there was no origin and cause report on Lyman until after the
13
Moonlight Investigators blamed Howell for the Moonlight Fire. As explained below, the
14
belatedly issued Lyman Fire report was fraudulent in ways similar to the Greens Fire report.
15
The Moonlight Prosecutors made misrepresentations to the Court in their trial brief and
16
their summary judgment opposition regarding the Lyman Fire. The Moonlight Prosecutors
17
represented to the Court in their trial brief:
18
The Lyman Fire ignited later that same season, on August 17, 2007,
once again in close proximity to Howells operations. Howells
learned the next day that the cause of the fire was an equipment-torock strike by a Howells employee conducting operations on Sierra
Pacific land.
19
20
21
The Moonlight Prosecutors also relied on the fraudulent Lyman Fire report in their
22
discovery responses.
23
On September 24, 2007, more than a month after the Lyman Fire broke out, Cal Fire
24
finally issued its report. Purportedly written by Cal Fire employee Les Anderson (Anderson),
25
the origin and cause report on the Lyman Fire concluded that one of Howells bulldozers was the
26
cause.
27
Defendants took Andersons deposition on July 14, 2011, and took the deposition of
28
85
another Lyman Fire investigator and expert witness for the United States, Greg Gutierrez
(Gutierrez), on October 19, 2011. Both Anderson and Gutierrez testified they had not
concluded that Howell caused the Lyman Fire. Anderson testified that he was not an investigator,
did no real investigation, and relied upon Gutierrez to do the origin and cause investigation.
Gutierrez then testified that, as occurred with Foster on the Greens Fire, he had been unable to
locate a point of origin or ignition source, thus making it impossible to reach a conclusion about
the cause. Gutierrez confirmed he had reached no formal conclusions at all regarding the Lyman
Fire, and that he was unable to rule out arson or other possible causes.
DOWNEY BRAND LLP
Evidence of other possible causes was readily available. Howell employee Robert Brown,
10
who was operating a bulldozer in the area where the Lyman Fire broke out, testified during his
11
deposition that there were known marijuana farms near where he was working, and that he had
12
seen people associated with these farms nearby.
13
Despite these facts, Cal Fire issued the Lyman Fire report shortly after the Moonlight Fire
14
broke out, stating that the Lyman Fire was caused by one of Howells bulldozers striking a rock.
15
Neither Anderson nor Gutierrez investigated the possibility that an individual working on the
16
nearby marijuana farm was responsible for starting the fire.
17
The same day that the Lyman Fire report issued, Cal Fire Battalion Chief David Harp
18
(Harp) sent Eunice Howell a demand letter, stating that [t]he [Lyman] fire . . . was caused by
19
one of your bulldozers striking a rock with a timber harvest clear cut area. Among other things,
20
Harp alluded to the potential for criminal charges and demanded that Eunice Howell immediately
21
send Cal Fire a check in the amount of $46,206.26. Harp then sent Eunice Howell another
22
demand letter on December 10, 2007, and then another letter on January 6, 2008, confirming
23
receipt of $26,206.26 and Ms. Howells agreement to make monthly installment payments until
24
the balance was paid off. Eunice Howell closed her business shortly thereafter.
25
Despite Anderson and Gutierrezs testimony confirming that they never concluded the
26
Lyman Fire was caused by Howells bulldozer striking a rock, Cal Fire never returned Howells
27
money.
28
Similarly, the Moonlight Prosecutors never amended or withdrew their reliance on the
86
false origin and cause report in their pleadings and discovery responses. Instead, the Moonlight
Prosecutors continued to rely on this report in response to various interrogatories, requests for
admission, the operative pleadings, and even in its pretrial brief to this Court, all in an effort to
support their allegations against Defendants in this action.
5
6
7
8
9
With respect to the Lyman Fire, Cal Fire does not even attempt to
deny that the conclusion of the Origin and Cause Report for that
fire prepared by Lester Anderson was false. There is no dispute
that his conclusion, that a Howells bulldozer ignited the Lyman
Fire, was flatly contracted by the lead investigator of the Lyman
Fire, Officer Greg Gutierrez, who testified that the cause was
properly classified as undetermined.
10
The Sheep Fire
11
The Sheep Fire occurred on either September 17 or September 18, 2007, in close
12
DOWNEY BRAND LLP
Discussing similar conduct by Cal Fire, Judge Nichols summarized the issues as follows:
13
proximity to where the Lyman Fire occurred a month prior. It burned less than an acre.
Cal Fire purportedly investigated the Sheep Fire and, as was the case with Greens and
14
Lyman, failed to locate a point of origin and failed to identify a source of ignition. Again, this
15
fact should have led to the conclusion that the Sheep Fires cause was undetermined. Once again
16
ignoring the scientific method, the Sheep Fire origin and cause report stated that the fire was
17
caused by the bulldozer tracks or rippers contacting the rocks in an outcropping.
18
As with the Greens and Lyman Fires, the Moonlight Prosecutors made misrepresentations
19
to the Court in their trial brief and their summary judgment opposition regarding the Sheep Fire,
20
as well as in discovery responses they served. The Moonlight Prosecutors knew, in making these
21
misrepresentations and in serving these responses, that the origin and cause conclusions for these
22
other fires were baseless. In fact, the Moonlight Prosecutors primary origin and cause
23
investigator Larry Dodds testified that Greens, Lyman, and Sheep were not investigated by first
24
string investigators, that those investigators drew conclusions which did not appear to be
25
sufficiently supported, and, based on the limited material he read, the three fires appeared better
26
classified as undetermined. The Moonlight Prosecutors nevertheless represented to the Court in
27
their summary judgment briefing that these fires placed Sierra Pacific on notice that Howell was
28
allegedly a dangerous operator. All three fraudulent reports were included as part of the Joint
87
Report, which was attached as the first exhibit to Whites Declaration in opposition to
Defendants motion for summary judgment. In its Order denying Defendants motion, the Court
relied extensively upon these false reports and upon Howells supposed connection to the Greens
and Lyman fires.
Defendants were generally aware of the facts and circumstances concerning the Greens,
Lyman and Sheep fires before the conclusion of the federal action, but this does not preclude
relief under Rule 60(d)(3). See Hazel Atlas, 322 U.S. at 246 (setting aside a judgment for fraud
upon the court notwithstanding the fact that the parties settled, that the defrauded party did not
seek relief until seven years after the settlement, and that the defrauded party suspected and was
10
actively investigating the fraud at the time of the settlement).
11
DOWNEY BRAND LLP
12
Analysis
The investigations and origin and cause reports for the Greens, Lyman, and Sheep Fires
13
were nothing more than opportunities seized upon to manufacture evidence to buttress the
14
allegations that Howell was a dangerous and rogue operator that started the Moonlight Fire.
15
Standing alone, the Moonlight Prosecutors manufacturing of this evidence constitutes another
16
fraud upon the court.
17
The Moonlight Prosecutors were not limited in the material they reviewed, like their
18
expert, Larry Dodds. Instead, the Moonlight Prosecutors had access to all the evidence, including
19
the depositions of Foster, Anderson, Gutierrez (whom they disclosed as an expert witness for the
20
United States), and Brown, which they attended and in some cases defended. Specifically, the
21
lead Moonlight Prosecutor defended Fosters deposition and understood that the Greens Fire
22
report was a sham. Yet Taylor continued to rely on this report and, in doing so, disregarded her
23
duties of disclosure and candor to the Court. See Shaffer, 11 F.3d at 458-59. Of course, the
24
Moonlight Prosecutors had a continuing duty to inform the Court of any development which
25
may conceivably affect the outcome of the litigation. Id. at 458 (citing Tiverton Bd. of License
26
Commrs v. Pastore, 469 U.S. 238, 240 (1985)). Their failure to do so upon learning of facts
27
evidencing that the investigations and reports relating to the Greens, Lyman and Sheep Fires were
28
all falsified, clearly violates this duty and worked a fraud on the Court.
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constituted compelling evidence that Howell, which actually had an exemplary safety record over
decades of operation, was instead a dangerous operator, that it started the Moonlight Fire, and that
the other Defendants were on notice that Howell presented a danger. These representations to the
Court were made without evidentiary support and in violation of the Moonlight Prosecutors duty
of candor, which they owed to the Court as officers of the court. See Shaffer, 11 F.3d at 458-59.
DOWNEY BRAND LLP
The Moonlight Prosecutors also continued to represent to the Court that these other fires
Of course, the most egregious facet of this fraud is the willingness to fabricate an origin
and cause report against Eunice Howell to collect more than $46,000 from her in order to support
its claims against Sierra Pacific and the Landowners. This fraud was only unveiled when
10
Defendants deposed the Moonlight Prosecutors expert witness Gutierrez, who confirmed he
11
never reached any conclusions about the cause of the Lyman Fire. The heartless quality of Cal
12
Fires act in extorting almost $50,000 from Eunice Howell reveals much of what this Court needs
13
to know about the government actors behind the Moonlight Fire action, as does the Moonlight
14
Prosecutors willingness to rely upon these fires in their filings with this Court. Separate from the
15
harm this caused Defendants, most specifically Eunice Howell, these acts rise to the level of a
16
fraud upon the Court because the Moonlight Prosecutors relied on this information in opposing
17
Defendants motion for summary judgment, and the Court, in turn, relied heavily on this
18
information when it ruled in favor of the United States. This constitutes a fraud upon the Court,
19
insofar as it prevented the Court from perform[ing] in the usual manner its impartial task of
20
adjudging cases that are present for adjudication. Intermagnetics, 926 F.2d at 916. Indeed, the
21
investigators conceived of this fraud, and intended these reports to have this effect; the Moonlight
22
Prosecutors knowingly carried it out without regard for their duties as officers of the court. The
23
integrity of the judicial process was necessarily harmed as a consequence of the Moonlight
24
Prosecutors scheme to improperly influence the court in its decisions . . . . Dixon, 316 F.3d
25
at 1046. These fires, and their fraudulent investigation and cause reports consistently relied on
26
and advanced by the Moonlight Investigators serve as yet another example of conduct
27
warranting action by the Court under Rule 60(d)(3).
28
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8.
The Moonlight Prosecutors Actively Covered Up Misconduct at the Red Rock

Lookout Tower in Verified Discovery Responses and Misrepresented the
State of the Evidence to the Court, Thereby Committing A Fraud Upon the
Court.
3
The Relevant Facts
4
5
6
range. These towers exist for one purpose: to facilitate spotting fires as soon as possible in order
to dispatch fire suppression resources before a fire gets out of control. The closest tower to the
Moonlight Fire, known as the Red Rock Lookout Tower, sits on Red Rock Mountain,
approximately ten miles away from where the Moonlight Fire began.
10
DOWNEY BRAND LLP
The USFS staffs a number of fire lookout towers throughout the Sierra Nevada mountain
The Red Rock Lookout Tower is a two story building with a square footprint. The lower
11
floor is largely vacant. The second floor (approximately 120 square feet) comprises the single
12
room living quarters (sometimes referred to as a cab or cabin) for housing the USFS lookout
13
stationed at the tower, sometimes for days on end. The perimeter of the second floor is framed
14
with windows, and the second floor exterior is surrounded on all sides with a balcony/catwalk.
15
An exterior stairway affixed to the outside of the tower provides access from the ground level to
16
the second floor exterior balcony.
17
Given the towers remote location, the tower can only be accessed via miles of dirt roads.
18
Vehicles approaching the tower on these roads create large dust plumes easily seen from the
19
tower for miles, especially during the late summer and fall, when the roads are at their driest. The
20
Red Rock Lookout Tower has an unobstructed direct line of sight to the general area where the
21
Moonlight Fire began.
22
According to the Joint Report, the fire was spotted and reported via radio transmission
23
from the Red Rock Lookout Tower at 2:24 p.m. But the events that transpired at Red Rock, and
24
the timeliness of the report from Red Rock (i.e. whether the fire could have been spotted and
25
reported sooner), as set forth more fully below, are the subject of a concerted plan to conceal
26
them from Defendants and the Court, conceived within the ranks of the United States Forest
27
Service, and transported into the realm of litigation by both the Moonlight Investigators and the
28
Moonlight Prosecutors.
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3
4
5
DOWNEY BRAND LLP
The Joint Report concludes as follows:

Based on the time lag from S-2 CRISMONS departure to the time
or [sic] report by Red Rock Lookout, I believe the fire maintained
in the incipient stage, smoldering in the dry fuel bed for
approximately 1 1/2 hours until it entered into the free-burning
stage and produced enough smoke to be identified by Red Rock
Lookout.
The timing of the report from Red Rock was a critical component of the Joint Report and
the conclusions therein regarding the circumstances surrounding the alleged ignition and early
spread of the Moonlight Fire. Moreover, from the outset of the action, Sierra Pacific asserted
with its first appearance a number of affirmative defenses, including comparative fault (a species
10
of contributory negligence under California law) on the part of the United States. Accordingly,
11
whether the USFS employee stationed at the Red Rock Lookout Tower on September 3, 2007,
12
exercised due care in the performance of his duties was necessarily a central issue in the case for
13
numerous reasons. The District Court so held in its pre-trial rulings.
14
Because of the importance of whether the Moonlight Fire was timely reported,
15
Defendants discovery efforts in the federal and state actions focused upon the events that
16
transpired in the hours and minutes leading up to 2:24 p.m. Only through persistent, expensive
17
and time consuming discovery efforts, did Defendants eventually uncover a carefully executed
18
cover-up of what really occurred at the Red Rock Lookout Tower on the afternoon of the fire.
19
The cover-up was conceived by the USFS and its lead investigator Welton; it was quickly
20
joined by Cal Fires lead investigator White; and it was then advanced through the litigation by
21
Welton and the Moonlight Prosecutors through misdirection and deception. What follows is a
22
summary of the documents and witness testimony concerning what actually happened on that
23
Labor Day afternoon when the Moonlight Fire erupted, followed by an explication of the false
24
narrative through which the Moonlight Investigators and arguably the Moonlight Prosecutors
25
obstructed justice in violation of at least 18 U.S.C. 1503 and 1519.
26
27
28
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a.
On September 3, 2007, a USFS employee named Caleb Lief was stationed in the Red
2
3
Rock Lookout Tower, charged with spotting smoke and fire as soon as possible in order to alert
suppression resources in time to prevent catastrophic burning. Visibility from the tower to the
surrounding landscape was excellent. In fact, Lief testified that during the morning hours of
September 3, 2007, he was able to see dust kicked up by the Howell bulldozers operating some
ten miles away.

Later that day, sometime shortly before 2:00 p.m., Karen Juska (Juska), a USFS fire
DOWNEY BRAND LLP
What actually happened in the Red Rock Lookout Tower.
prevention technician who intended to repair a broken radio in the tower, began making her way
10
up to Red Rock Lookout Tower on a winding dirt road in her USFS pickup truck. She had called
11
in her plans via radio earlier that day. The road and the dust plume created by her USFS pickup
12
could easily be seen from the tower.
13
When Juska arrived, she parked her truck at the base of the tower roughly 20 feet away.
14
Juska opened and closed the door of her pickup and walked to the tower. She then ascended its
15
single flight of stairs, reached the top of the stairs, stepped onto the catwalk, and turned right
16
towards the door on the elevated cabin. All of this escaped the attention of federal lookout Lief.
17
After reaching the catwalk at the top of the stairs and turning right, Juska caught Lief by
18
surprise. He was facing her direction, looking down, urinating on his bare feet. Shocked by her
19
sudden appearance before him, Lief spun away from her to zip up his pants, saying over his
20
shoulder, Dont think I am weird or gorse [sic], its an old Hot-shot trick to cure athletes foot.
After Lief collected himself, Juska and Lief entered the second floor of the tower. Once
21
22
inside, Juska spotted what she described as a blue-green glass marijuana pipe on the counter
23
adjacent to the tower sink. Lief quickly grabbed the pipe, put it behind his back or in his back
24
pocket and said, My bad, you werent supposed to see that.
25
Shortly thereafter, Lief handed Juska the radio that she had come to the tower to repair.
26
As he handed it to her, Juska smelled the heavy odor of marijuana on Liefs hand and on the
27
radio.52
28
52
Although Juska testified that she looked for smoke plumes on the landscape upon entering the tower and saw
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and placed it in the bed of the truck. While standing behind the bed of Juskas pickup truck,
Juska spotted the plume from the fire over Liefs shoulder. Lief testified that, by this time, the
smoke plume was huge.
DOWNEY BRAND LLP
A short while later, Lief and Juska took a bag of trash outside the tower to Juskas vehicle
Juska and Lief dispute which one of them first spotted the fire, but Juska reported the fire
to the dispatch center via radio from her truck as Lief ran back into the tower. The dispatch
center then contacted Lief in the tower, who was in the best position to provide the precise
coordinates of the smoke plume by using the spotting equipment designed for that specific
purpose, including what is known as an Osborne Firefinder. Consistent with Liefs bizarre
10
behavior (potentially indicative of the influence of marijuana), the fire coordinates he provided
11
were off by approximately one mile. The events set forth above were memorialized in a memo
12
drafted by Juska:
13
14
15
16
17
18
19
20
21
22
23
24
25
During the week after the ignition of the fire, the events that transpired at Red Rock, as
26
witnessed by Juska, were reported and discussed both verbally and through email exchanges
27
nothing, she was upset by what she had witnessed with Lief and was not a trained fire-spotter. Moreover, her
statement is contradicted by Lief, who testified that the fires plume was huge when they eventually did see it from
below the tower.
28
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involving the management team for the Plumas National Forest, and the matter was referred to
USFS law enforcement for investigation. The investigation never took place.
b.
4
5
On September 12, 2007, United States law enforcement officer Welton conducted
interviews of both Lief and Juska in furtherance of her work on the origin and cause investigation.
By then, Welton was well-aware of the misconduct at Red Rock Lookout Tower on the day of the
fire.
DOWNEY BRAND LLP
The Cover-Up: What the Investigators and the Moonlight Prosecutors said
about what happened at the Red Rock Lookout Tower.
According to Juskas sworn testimony and her own contemporaneous notes, just before
10
the interview began, Welton instructed Juska to stay silent about Liefs misconduct on the day of
11
the fire. Essentially, Juska was to omit those particular facts as Welton purported to record from
12
Juska what she had witnessed on that day. In this regard, Welton expressly told Juska, I cant
13
know about that.
14
After providing those instructions, Welton prepared and signed a report of her interview
15
of Juska, which differed greatly from the internal memorandum Juska has previously prepared
16
regarding what actually transpired. The witness statement that Welton prepared for Juska
17
included a body of arguably inconsequential details, including when and where Juska ate lunch on
18
that day as she made her way up to the Red Rock Lookout Tower.53 Welton included these
19
details to create the appearance that her report was complete and thorough, even though it
20
concealed the most important events that had transpired at the Red Rock Lookout Tower.
21
Weltons summary of her interview with Juska omitted any reference to Liefs
22
misconduct, which occurred during the critical moments while the fire was in its initial stages.
23
The official form completed by Investigator Welton fails to reference in any way the fact that
24
Juska was able to catch the lookout (whose sole purpose was to notice all that occurred around
25
him) by surprise. It fails to mention the fact that Juska found Lief on the side of the tower
26
27
28
53
Including a reference to where Juska had lunch that afternoon while omitting all the material facts she
witnessed at Red Rock is akin to describing what President Lincoln wore to the theater while omitting the
fact that he was assassinated as he watched the show.
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opposite the fire, looking down while urinating on his bare feet. It fails to record the fact that
Juska found what she believed was a blue-green glass marijuana pipe in the tower. It omits the
fact that Juska smelled the heavy odor of marijuana emanating from Liefs hand and the radio
when he handed it to her.
Welton engaged in a similar deception as it pertains to Lief. Her official witness
statement from Lief contains no mention of anything Juska caught him doing, no mention of any
fact showing that Lief was not properly performing his lookout duties at the very time the
Moonlight Fire began to burn, and no mention that he was in violation of various federal policies
and the law. Indeed, Weltons official summary of her interview with Lief reflects no indication
10
that Welton made any effort to conduct a real interview of Lief regarding these critical facts.
DOWNEY BRAND LLP
11
Nevertheless, Welton prepared and signed both witness statements, affirming that each
12
was true, accurate, and complete and Welton then included both of her falsified witness
13
interview statements in the Joint Report.
14
Defendants would not have discovered the true facts but for their ultimately successful
15
motion to open what the federal prosecutors attempted to shield within confidential
16
employment records, and what the Moonlight Prosecutors attempted to conceal through patently
17
false written discovery responses on the topic of what actually happened at Red Rock.
18
Welton and the Moonlight Prosecutors did not engage in this effort alone. Ron
19
Heinbockel, the Assistant District Fire Management Officer in the Plumas National Forest who
20
supervised Juska and Lief, confirmed in an email he sent to the acting U.S. District Ranger, Dave
21
Loomis, that Loomis instructed Heinbockel to give Lief a fully satisfactory performance review
22
for 2007, notwithstanding Liefs misconduct that day, and that he was not to mention any of
23
Liefs misconduct in his performance evaluation. Heinbockel told Loomis that he was very
24
uncomfortable giving Lief this satisfactory designation, that it was a safety issue, and that he
25
did not want to hire Lief back for the next fire season.54 A copy of Heinbockels email is set forth
26
below:
27
28
54
Heinbockel testified during his deposition that he had wanted Lief terminated immediately in 2007.
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The fact that Heinbockel was ordered to participate in conduct designed to cover up what
actually happened at the Red Rock Lookout Tower is also revealed through his deposition
testimony and other documents. Under oath, Heinbockel testified that it was his understanding
certain members of the USFS did not want to make Lief angry as they did not want him to shoot
his mouth off. He testified that they wanted to keep him on our side.
Under oath, Heinbockel gave the following testimony, wherein he confirmed the intent on
the part of USFS management to engage in a cover-up of the events that transpired at the Red
Rock Lookout Tower:
20
Q. BY MR. WARNE: I dont want
21
A. Part of it.
22
Q. Go ahead, sir. What?
23
A. Part, yes.
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25
Q. You were concerned at least in part that he could shoot his

mouth off about what really took place on the fire if in fact he was
fired?
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MS. TAYLOR: Same objections.
27
THE WITNESS: Or
28
Q. BY MR. WARNE: Go ahead, sir.

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A. Or just of our just some of the things that bugged him about
the Forest Service.
2
3
Q. One of the things you were concerned about him talking about
was what actually happened on the day of the fire, correct?
MS. TAYLOR: Argumentative.
Q. BY MR. WARNE: If he was fired?
MS. TAYLOR: Misstates. Assumes facts not in evidence. Calls

for speculation.
7
THE WITNESS: Yes.
8
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Q. BY MR. WARNE: Okay. And the other things that you

understood there were concerns about were that if in fact he was
fired and he wasnt on your side he could do what?
10
A. Just be slanderous.
11
DOWNEY BRAND LLP
12
Consistent with the plan to keep Lief on our side, the USFS hired him back for the 2008
13
and 2009 fire seasons. Neither the USFSs lead Moonlight Investigator nor any other USFS
14
employee ever investigated the allegations of Liefs drug use.
15
When law enforcement officer Welton was eventually deposed, she was defended by the
16
lead Moonlight Prosecutor, Taylor. As Welton testified, the lead Moonlight Prosecutor failed to
17
abide by her duties of candor, and instead allowed Welton to testify that she did not report what
18
Juska witnessed that day because it wasnt pertinent. In this regard, Welton lied under oath
19
through most of the first day of her deposition. Remaining perfectly sanguine in allowing her to
20
do so, Taylor assisted Welton throughout the questioning by interposing as many objections as
21
possible while Weltons fraud was slowly exposed.
22
Of course Liefs inattentiveness and conduct was highly pertinent. In addition to the
23
Courts ruling that the timing of the report of the fire was relevant to Defendants affirmative
24
defenses, Heinbockel conceded in his deposition that Liefs conduct was relevant and that the
25
facts might have some bearing on whether Lief failed to spot the fire when he should have. In
26
fact, Heinbockels concerns were also documented in an internal USFS document which
27
Defendants obtained only after filing a motion:
28
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I knew this was a real serious matter. This is our main lookout in
the Moonlight Valley. I could just see all sorts of legal problems.
The attorneys would say the main lookout is stoned and let a fire
go. In [Liefs] performance [evaluation], I wanted to give him a
no-re-hire and an unsatisfactory performance ratingAnd Dave
Loomis [sic] reply [was] to give him a satisfactory performance
rating.
c.
2
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The lead Moonlight Prosecutor Taylor joined in the effort to cover up what
actually occurred at the Red Rock Lookout Tower.
DOWNEY BRAND LLP
As set forth below, most of the above-referenced facts concerning Liefs misconduct and
the fallout within the USFS were revealed only after Defendants filed a motion to require the
Moonlight Prosecutors to produce materials they had been wrongfully withholding concerning
10
Liefs malfeasance at Red Rock Lookout Tower. Without those documents, Defendants would
11
not have been able to identify critical witnesses and would not have known to pursue certain lines
12
of cross-examination.
13
Early in the case, before obtaining the documents or subsequent testimony that disclosed
14
the above-referenced misconduct on the part of Lief, Sierra Pacific had heard rumors that the
15
USFS was covering up something that occurred at the Red Rock Lookout Tower on the first day
16
of the fire and that it may have had some impact on whether the fire was timely spotted.
17
Accordingly, given that the USFSs diligence in spotting and reporting the fire was a central issue
18
in the case, Sierra Pacific sought to expose the issue by propounding the following unambiguous
19
interrogatory:
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Describe in detail all activity at Red Rock Lookout on September 3,

2007, including (without limitation) the IDENTITY of all
PERSONS involved and all conduct and action taken by those
PERSONS.
22
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This was the first interrogatory Sierra Pacific propounded in the federal Moonlight Fire
24
action. In the Moonlight Prosecutors verified response, signed by Taylor and verified under
25
penalty of perjury by USFS Plumas Division Chief Larry Craggs, the United States responded on
26
July 9, 2010, as follows:
27
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Thus, the Moonlight Prosecutors drafted and signed demonstrably false interrogatory
27
responses regarding Red Rock, which to this day, they have never amended, modified, or updated
28
in any way. The Moonlight Prosecutors have failed to do so, even though Craggs, who verified
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the response, admitted during his deposition that the response was not truthful. When asked why
he had verified the response under penalty of perjury when he knew it was untrue, he said he was
handed the document, that it was written by someone else, and that I didnt know I was supposed
to add more to the document.
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additional false discovery responses. For instance, in response to Sierra Pacifics effort to obtain
admissions on whether there was any misconduct at the Red Rock Lookout Tower on
September 3, 2007, the Moonlight Prosecutors signed responses for the United States that
expressly, and falsely, denied each request. Specifically, without objection, the Moonlight
10
Prosecutors signed responses for the United States that expressly, and falsely, denied the
11
following:
12
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The Moonlight Prosecutors then continued this fraud on Defendants and the Court with
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Admit that on September 3, 2007, Caleb Lief engaged in conduct

prohibited by the USFS, while he was on duty at RED ROCK
LOOKOUT.
Admit that on September 3, 2007, Caleb Lief engaged in conduct
prohibited by the USFS.
Admit that on September 3, 2007, Karen Juska witnessed Caleb
Lief engaged in conduct prohibited by the USFS.
Sierra Pacific also propounded further written discovery requests on the United States,
18
attempting to resolve any dispute regarding the facts associated with the misconduct at the Red
19
Rock Lookout Tower. Despite the USFSs internal finding that Caleb Lief and Karen Juskas
20
interactions on September 3, 2007, amounted to misconduct, the Moonlight Prosecutors served
21
false denials in response to Sierra Pacifics requests for admissions regarding that very same
22
issue. In doing so, Taylor, an officer of the Court, was also speaking for the United States.
23
Demjanjuk v. Petrovsky 10 F.3d 338; 353 (holding that When the party is the United States,
24
acting through the Department of Justice, the distinction between client and attorney actions
25
becomes meaningless.)
26
The possession by a federal employee of illegal drug paraphernalia while on duty
27
constitutes misconduct. The use of illegal drugs while on duty as a federal employee on federal
28
land also constitutes misconduct. The fact that the USFS understood that Lief had engaged in
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misconduct was confirmed by Maria Garcia, the USFS deputy forest supervisor for the Plumas
National Forest, when she testified that Juskas allegations were referred to law enforcement.
Finally, an internal document generated by the USFS described Liefs interactions with Juska as
misconduct.
DOWNEY BRAND LLP
The Red Rock Lookout Tower cover-up was also furthered through the Moonlight
Prosecutors response to Sierra Pacifics request that the government admit that one or more
USFS employees superior to Caleb Lief wanted to terminate Lief immediately following the
Moonlight Fire. Again, the U.S. Attorneys denied the request, despite the fact that, as described
above, Ron Heinbockel Lief and Juskas direct supervisor attempted to give Lief an
10
unsatisfactory rating and believed he should be fired, but was forced to give him a fully
11
satisfactory review instead. The lead Moonlight Prosecutor attended and defended this
12
deposition, and yet never corrected these false written discovery responses, which flatly
13
contradicted both Heinbockels internal writings, and his sworn deposition testimony.
14
The Moonlight Prosecutors also chose to deny other requests for admission that they knew
15
to be true. For instance, in its ninth request for admission, Sierra Pacific asked the government to
16
admit that at some point from 2:00 to 2:30 p.m. on September 3, 2007, no USFS employees at
17
RED ROCK LOOKOUT, including (without limitation) Caleb Lief, were watching for fire. The
18
U.S. denied this request. However, the Moonlight Prosecutors knew that Karen Juska had
19
revealed that when she arrived at Red Rock on September 3, 2007, between 2:05 and 2:10, she
20
found Caleb Lief outside of the lookout, on the opposite side of the cabin from where the fire was
21
burning, looking down while urinating on his bare feet. These are but a few examples of
22
numerous occasions where the Moonlight Prosecutors chose to lie in response to discovery
23
requests.55
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In light of the Moonlight Prosecutors false interrogatory responses, which were verified by USFS Fire
Management Officer Larry Craggs, Sierra Pacific sought, among other things, sanctions by filing a motion with
Magistrate Judge Edwin Brennan on January 14, 2011. To its surprise, Sierra Pacific did not prevail on that motion.
Perhaps the magistrate, in light of his own experience as a long-time Assistant United States Attorney in the U.S.
Attorneys Office for the Eastern District of California and as the USFSs lead counsel in numerous actions for years
before he became a magistrate, was justified based on his own experiences in assuming that such charges simply
could not be true. Clearly, judges have a right to expect the best from federal prosecutors, and the federal prosecutors
on the Moonlight Fire case took advantage of their credibility with Judge Brennan while committing a fraud upon the
Court with respect to their actual conduct.
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Defendants took other depositions that confirmed the Moonlight Investigators and
Prosecutors plan to cover up the damaging Red Rock facts and obstruct justice. 56 The
depositions of Juska, Welton, Craggs, and Heinbockel all confirmed this, as did the depositions of
Loomis, Maria Garcia, and the head of the Plumas National Forest in 2007, Alice Carlton. In
fact, it was Carlton who cautioned USFS management that they needed to be careful that their
treatment of the Red Rock incident would not be seen as a cover-up. Had Defendants relied on
the Moonlight Prosecutors and their false discovery responses, the truth may never have been
revealed.
DOWNEY BRAND LLP
To this day, and even after Craggs admitted that the Moonlight Prosecutors interrogatory
10
responses were false, and even after discovery showed other responses on Red Rock were also
11
false, the Moonlight Prosecutors have never amended or retracted any of the false discovery
12
responses served on behalf of the United States, and never informed the Magistrate Judge of these
13
additional facts to correct the record and his Order.
14
The Moonlight Prosecutors also never amended any of the discovery responses wherein
15
the United States incorporated by reference the Joint Report, even though it was clear based on
16
the testimony and documents that the Joint Reports depiction of what happened at Red Rock
17
was a complete fabrication. Instead of correcting the record, the Moonlight Prosecutors deepened
18
the corruption by attaching the Joint Report, including Weltons falsified Red Rock witness
19
statement summaries, to the Declaration of Joshua White filed with the district court in opposition
20
to Defendants motion for summary judgment.
21
The Moonlight Prosecutors fraud on the court continued on other fronts as well. Near the
22
close of discovery, after it was clear that the Moonlight Prosecutors written interrogatory and
23
RFA responses concerning Red Rock were fraudulent, the Landowner Defendants served a
24
request for admission on the USFS, asking it to admit that the United States previous response to
25
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56
If, before the hearing, Magistrate Judge Brennan had known of the facts regarding the Red Rock cover-up that
Defendants were able to develop after his Honor denied their motion on January 25, 2011, including the facts
revealed during the numerous depositions that were not taken until after the motion was heard, Defendants believe
that Judge Brennan would not only have granted the motion but would likely have issued findings and
recommendations dismissing the action for gross prosecutorial misconduct.
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Interrogatory No. 1 about what transpired at Red Rock Lookout Tower was false, and that the
United States knew it to be false before serving the verified response.
3
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asserted, [T]he USFS denies this request in full. The USFS denies that any portion of the
response was false. The Moonlight Prosecutors signed and served this response even though
Craggs, who verified the prior interrogatory response, had at this point already admitted under
oath at his deposition that the interrogatory response was not complete and truthful.
8
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DOWNEY BRAND LLP
Answering the Landowners RFA, the Moonlight Prosecutors objected, and then brazenly
The Landowner Defendants also served over 250 additional requests for admissions
seeking the truth from the Moonlight Prosecutors regarding what had finally been discovered
10
about the plan amongst a group of federal employees to conceal from these Defendants and the
11
Court the events that transpired at the Red Rock Lookout Tower, and the effort by the USFS to
12
continue to employ Caleb Lief to keep him on [their] side even though they believed he
13
presented a public safety hazard. These requests also covered the landscape of investigatory and
14
prosecutorial abuses in connection with other aspects of the litigation. In response to the vast
15
majority of these interrogatories, the lead Moonlight Prosecutor either falsely entered an
16
unequivocal denial, or refused to provide an answer without justification. Through dozens of
17
written responses to these requests for admission, the lead Moonlight Prosecutor falsely denied
18
the existence of virtually every fact harmful to the prosecution that had been established by either
19
internal USFS documents, or through sworn testimony of USFS witnesses during their
20
depositions.
21
As trial approached, the Moonlight Prosecutors made submissions to the District Court
22
which continued their false narrative regarding the events that occurred at the Red Rock Lookout
23
Tower, and their culpability in attempting to cover up those events. The Moonlight Prosecutors
24
trial brief states:
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Further, the unclean hands defense fails because the United States
has purged itself of any alleged cover up. The defense of unclean
hands is inappropriate where a party purges itself of the inequitable
conduct giving rise to the defense. . . . Here, the only basis for an
unclean hands defense that any defendant has arguably pled is
Sierra Pacifics vague allegation that the Forest Service
suppressed evidence of conduct at the Red Rock Lookout. . . .
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Thus, even if the defendants could prove that evidence of Liefs

conduct was suppressed, such suppression was purged by the
United States subsequent full disclosure of the information.
The Moonlight Prosecutors representation that they had made a full disclosure was
3
4
itself a gross misrepresentation to this Court. The Moonlight Prosecutors in no way purged
themselves of the inequitable conduct regarding what truly occurred at the Red Rock Lookout
Tower, as the Moonlight Prosecutors never made any attempt to correct the record before the
Court and continued to proffer false discovery responses about the attempted cover-up of these
facts.
DOWNEY BRAND LLP
Defendants discovered the Moonlight Investigators and the Moonlight Prosecutors false
10
witness statements, false reports, and false verified discovery responses concerning the events
11
that transpired at the Red Rock Lookout Tower during the pendency of the federal action, but this
12
does not preclude relief under Rule 60(d)(3). See Hazel-Atlas, 322 U.S. at 246 (setting aside a
13
judgment for fraud upon the court notwithstanding the fact that the parties settled, that the
14
defrauded party did not seek relief until seven years after the settlement, and that the defrauded
15
party suspected and was actively investigating the fraud at the time of the settlement).
Analysis
16
17
Standing alone, the Moonlight Investigators and Moonlight Prosecutors continued and
18
unabated efforts to cover up the events that transpired at the Red Rock Lookout Tower, and their
19
misrepresentations to the Court that they had purged themselves of malfeasance, separately
20
constitute fraud upon the Court and warrant relief under Rule 60(d)(3), setting aside the
21
judgment.
22
In covering up these key events that are material to the issues at the heart of this case, the
23
Moonlight Investigators and Prosecutors harmed the integrity of the judicial process Dixon, 316
24
F.3d at 1046, and they prevented the judicial machinery [from] perform[ing] in the usual manner
25
. . . . Intermagnetics, 926 F.2d at 916. From the Moonlight Investigators preparation of a false
26
summary of her interview of Juska, to the Moonlight Investigators incorporation of Juska and
27
Liefs fraudulent interview reports into the Joint Report, to the USFSs retention of Lief to secure
28
his cooperation as a witness, to the Moonlight Prosecutors repeated false discovery responses
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regarding these events and their subsequent misrepresentations to the Court regarding their
conduct, the Moonlight Prosecutors and Investigators, together and separately, conceived of and
executed an unconscionable plan or scheme which is designed to improperly influence the court
in its decisions, which amounts to a fraud on the court. Dixon, 316 F.3d at 1046.
DOWNEY BRAND LLP
Notwithstanding the Moonlight Prosecutors positions within the Department of Justice
lawyers entrusted with the honor of representing the United States they actively concealed the
very conduct which transpired at the Red Rock Lookout Tower that would be most relevant to
Defendants in this case and concealed the information that would be most damaging to the
Moonlight Fire prosecution team. In this regard, the Moonlight Prosecutors false discovery
10
responses are orders of magnitude more pervasive and egregious than the prosecutorial
11
misconduct the federal court in Shaffer so forcefully admonished, and which easily constituted a
12
fraud upon the court. See Shaffer, 11 F.3d at 456.
13
Moreover, there is no room for argument that the Moonlight Prosecutors falsification of
14
evidence somehow only amounted to immaterial or technical inaccuracies. See Pumphrey, 62
15
F.3d at 1133. The events that occurred at the Red Rock Lookout Tower are central to affirmative
16
defenses at issue in the case, as the Court confirmed when it denied the Moonlight Prosecutors
17
motion in limine to exclude evidence related to Red Rock. Accordingly, the false narrative
18
regarding those events proffered to both Defendants and to this Court serve to establish fraud
19
upon the court.
20
Even had the Moonlight Prosecutors not presented the false Red Rock interviews to the
21
Court, and had they not falsely represented to the Court that they had purged themselves of
22
their malfeasance, their discovery abuses and perjured discovery responses, perpetrated by
23
officers of the Court, would alone have constituted a fraud upon the Court because [t]he
24
discovery process is an integral part of the judicial process. Derzack, 173 F.R.D. at 416. As in
25
Derzack, the parties were engaging in court-ordered discovery under the authority and
26
jurisdiction of the [court] and its rules and procedures. Id. The Moonlight Prosecutors, in
27
submitting discovery responses that fraudulently excluded any reference to these important facts,
28
in subsequently refusing to admit in discovery responses that the initial response was false, and
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finally in representing to the Court that this abuse had been purged, engaged in a pattern and
practice of stonewalling, bad faith and lack of candor. Id. In Derzack, fraud on the court was
found where the plaintiffs manipulated financial data relevant to their business loss claim, and
turned over falsified, fraudulent documents to the opposing party. Id. at 404. Here, the
Moonlight Prosecutors manipulated the facts, and the language of an interrogatory, to mislead
Defendants and the Court. Similarly, the Ninth Circuit in Pumphrey found that the defendants
failure to supplement discovery responses with evidence once it was discovered, as well as the
defendants false discovery responses which mischaracterized material evidence, contributed to
the defendants commission of a fraud on the court. 62 F.3d at 1131-32. The true facts
10
associated with what transpired at the Red Rock Lookout Tower were central to this litigation,
11
and the Moonlight Prosecutors active and ongoing effort to cover them up is even more
12
egregious than the behavior that the Derzack and Pumphrey courts agreed warranted relief under
13
Rule 60(d).
14
In their portion of the Joint Status Report, the Moonlight Prosecutors attempted to recast
15
and mischaracterize Defendants motion by wrongly claiming, The motion to set aside [sic]
16
judgment is not about bribery of a judge or jury, or fabrication of evidence by counsel, or
17
anything similar. (Docket No. 612 at 18:7-8.) This assertion is clearly incorrect. As so
18
thoroughly explicated here, the Moonlight Prosecutors did in fact affirmatively fabricate evidence
19
by personally authoring and signing false interrogatory responses, and securing the perjured
20
verification of them by a USFS employee who knew them to be incomplete and untrue, all in an
21
effort to perpetuate the concealment of evidence not supportive of their claims. Once the true
22
facts were discovered, the Moonlight Prosecutors authored scores of additional false discovery
23
responses, all designed to avoid any concession with respect to their original efforts to hide the
24
truth and then justify their efforts to do so.
25
Finally, the facts associated with the Red Rock Lookout Tower establish that the USFS,
26
with the assistance of Moonlight Investigator Welton, engaged in yet a further distinct species of
27
fraud upon this Court by improperly attempting to influence a material witness, in violation of
28
federal law. Specifically, USFS employee Heinbockel conceded that the USFS continued to
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employ Lief as a fire lookout, even though keeping him employed was a known safety issue. As
revealed by Heinbockel in his deposition, the USFS made this election for the purpose of
keeping him on our side in the context of the Moonlight litigation for fear that he would
otherwise go shooting his mouth off. That the USFS personnel involved in this matter would
put their own cover-up and the promise of a financial recovery above the safety of others says
volumes about how misguided the Moonlight Fire matter had become. In short, the story could
hardly be any uglier: certain members of the USFS were willing to bribe Lief with a position so
as to buy his silence, regardless of the risk he posed to others. But such conduct constitutes far
more than a breach of public trust. The USFSs conduct on this front, and Weltons instructions
10
to Juska and Lief before their interviews, constituted the obstruction of justice under 18 U.S.C.
11
1512(c), which establishes felony liability for whoever corruptly persuades another person or
12
attempts to do so with the intent to influence the testimony of any person in an official
13
proceeding. This fraudulent and illegal conduct is directly related to this Courts determination as
14
tampering with witnesses is itself an act that constitutes a separate fraud upon this Court. See Ty
15
Inc. v. Softbellys, Inc., 517 F.3d 494, 498 (7th Cir. 2008) (holding that [t]rying improperly to
16
influence a witness is fraud on the court).
17
18
9.
The Moonlight Prosecutors Made Reckless Misrepresentations About Cal

Fires Civil Cost Recovery Program to Procure Another Favorable Pretrial
Ruling on a Material Issue, Thereby Committing a Fraud Upon the Court.
19
The Relevant Facts
20
Long after this Court entered its dismissal order premised on the federal settlement,
21
Defendants discovered facts which revealed that the Moonlight Prosecutors made reckless
22
misrepresentations to this Court about the legitimacy of Cal Fires civil cost recovery program,
23
which were directly relevant to the Courts pretrial rulings. The true facts flatly contradict
24
positions taken by the Moonlight Prosecutors in their pretrial motions.
25
As part of their pretrial Omnibus Motion in Limine, the Moonlight Prosecutors included a
26
motion styled, Motion to Exclude Argument of Government Conspiracy and Cover Up. In
27
support of that Motion, the Moonlight Prosecutors first attacked a straw man, arguing that
28
Defendants so-called conspiracy allegations were premised in part on the fact that Cal Fire has a
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fire cost recovery program . . . . But the mere existence of a cost recovery program was never
Defendants stated concern. Instead, Defendants were troubled by the possibility that, under its
program, Cal Fire might be diverting a portion of the money it was recovering from those it
accused of starting wildland fires into accounts controlled by wildland fire investigators. Any
such practice would naturally instill a financial bias in investigators, whether consciously or
unconsciously, to target and collect from affluent defendants.
7
8
defendants allegations of a conspiracy are unsupported and falsely described for the Court Cal
Fires cost recovery system as a benign public program established for altruistic purposes, as
10
11
12
DOWNEY BRAND LLP
The Moonlight Prosecutors nevertheless claimed in their motion in limine that
13
14
15
follows:
The other evidence Defendants rely upon is equally flimsy. That Cal Fire has a fire cost
recovery program does not support an inference that investigators concealed evidence.
Under the program, a portion of assets recovered from Cal Fires civil recoveries can be
allocated to a separate public trust fund to support investigator training and to purchase
equipment for investigators (e.g., investigation kits and cameras). A public program
established to train and equip fire investigators is hardly evidence of a multi-agency
conspiracy.
16
Despite the Moonlight Prosecutors representations to the Court, Defendants were concerned that
17
any civil cost recovery dollars earmarked for accounts controlled by Cal Fire investigators created
18
beneficiaries out of those responsible for reaching causation decisions. As such, an unacceptable
19
bias would be created which favored blaming affluent parties to the exclusion of other possible
20
causes. To perpetuate such a fund and the benefits flowing from it, investigators might name
21
affluent individuals and entities as defendants, rather than name penurious culprits, such as
22
arsonists, who generally provide little or no prospect of financial recovery. At the time of the
23
motions in limine briefing, however, Defendants discovery efforts had uncovered remarkably
24
little information to support this common sense conclusion.
25
In the state action, Defendants propounded discovery on Cal Fire in October 2010,
26
seeking All DOCUMENTS evidencing the use of any money recovered from any wildfire
27
litigation to which YOU were a party in the last ten years. Notwithstanding the fact that both
28
Cal Fire and the Moonlight Prosecutors benefitted from the assertion of a joint prosecution
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privilege under a joint prosecution agreement when convenient for their mutual purposes, Cal
Fire was not a party to the federal action and thus Defendants propounded discovery requests for
Cal Fire documents only in the state action. In response to Defendants requests, Cal Fire and its
attorneys produced only two responsive documents concerning an outside fund: a single cryptic
accounting spreadsheet, and what Cal Fire described as a CDAA Audit Report. The CDAA
Audit Report pertained to a November 2009 Cal Fire internal audit of a program labeled the
Wildland Fire Investigation Training and Equipment Fund (WiFITER) administered by the
California District Attorneys Association (CDAA) on behalf of Cal Fire.57
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This audit report generally found WIFITER to be of considerable value and stated that
10
the audit did not reveal any significant internal control problems or weaknesses. Thus, the
11
proffered material made it appear as if WiFITER was a legitimate program controlled not by Cal
12
Fire, but by the CDAA. As explicated below, Defendants learned after the resolution of the
13
federal action that this audit report provided to Defendants was falsified.
14
Defendants encountered similar road blocks in the federal action. During the federal
15
deposition of United States expert Chris Parker (a recently retired Cal Fire Deputy Chief of Law
16
Enforcement), Parker reluctantly admitted that he had conceived of and founded the WiFITER
17
account in 2005. But Parker testified that the account was created only for altruistic purposes to
18
benefit Californians and rejected any suggestion that the fund might bias investigators. At no
19
time did Parker ever suggest that the account was established to circumvent state fiscal controls.
20
Thus, at the time of the federal pretrial conference, Defendants had only limited evidence to prove
21
their theory of a cover-up or conspiracy associated with WiFITER, or to prove their theory that
22
the WiFITER account (ostensibly controlled by the CDAA) instilled any bias in those individuals
23
controlling the Moonlight Fire investigation, including law enforcement officer White and his
24
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Under California law, Cal Fire is the state agency charged with pursuing wildland fire cost recovery actions under
Health and Safety Code section 13009, the proceeds of which are required by law to be returned to the states general
fund. Moreover, section 8002 of the State Administrative Manual makes it illegal for any agency to set up a separate
account without express authority from the Department of Finance. Given this Request for Production, and given the
state prosecutors duties of disclosure, Defendants expected that, as officers of the court, the government attorneys
would disclose any facts which called into question the credibility of investigators flowing from the WiFITER
account. As discussed infra, during the pendency of the federal action, Cal Fire, its in-house general counsel, and its
litigation counsel from the Office of the California Attorney General, concealed virtually all evidence favorable to
the defense concerning WiFITER.
109
supervisor and mentor, officer Carlson.
Given the state of the evidence then available to this Court and Defendants, the Court
granted the Moonlight Prosecutors motion in limine with respect to conspiracy arguments as it
pertained to the impact of Cal Fires cost recovery program. Thus, as a result of the Moonlight
Prosecutors motion in limine and representations to the Court concerning WiFITER, the Court
entered an order foreclosing Defendants from arguing that the Moonlight Investigators were part
of any conspiracy concerning the handling, retention, or expenditure of wildland fire monies
collected. The Courts ruling on this issue contributed to the increased risks of trial and
Defendants settlement assessment, and it was a substantial factor in causing Defendants to settle
10
the federal action. Although Defendants disagreed with the Courts ruling, it was not necessarily
11
a surprise given the limited evidence then available to the Court.
DOWNEY BRAND LLP
12
Circumstances, however, changed rather dramatically after October 15, 2013, when the
13
California State Auditor issued a Formal Audit Report concerning Accounts Outside the States
14
Centralized Treasury System. California State Auditor, Accounts Outside the States
15
Centralized Treasury System, http://www.bsa.ca.gov/pdfs/reports/2013-107.pdf (last visited
16
January 13, 2015). The final portion of the State Auditors report contains findings regarding
17
WiFITER, which the State Auditor summarized as follows:
18
Cal Fire had $3.7 million in settlement payments for the cost of fire
suppression and investigation (cost recovery revenues) deposited
into an outside account, the Wildland Fire and Investigation
Training and Equipment Fund (Wildland Fire Fund), that was
neither authorized by statute nor approved by Finance. 58 Further, it
did not subject the money in this outside account to its own internal
controls, nor did it track or monitor the accounts revenues
adequately. Specifically, the management of Cal Fires law
enforcement unit bypassed Cal Fires accounting and budgeting
processes by failing to submit a request to its accounting office to
establish the account and by diverting and spending cost recovery
revenues without submitting the appropriate request to increase its
budget appropriations. As a result, this portion of Cal Fires cost
recovery revenue was not subject to Cal Fires normal internal
controls or to oversight by the control agencies or the Legislature,
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Elsewhere, the State Auditor confirmed that State Administrative Manual section 8002 requires all accounts
established outside the State Treasury to be approved and authorized by the California Department of Finance.
110
leaving Cal Fire open to possible misuse of these revenues.
Id. at 26-39. The State Auditors findings were based in part on a critical January 8, 2005,
internal Cal Fire email by Chris Parker to other high ranking Cal Fire managers regarding the
formation of WiFITER. The State Auditor described and analyzed this email as follows:
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An e-mail dated January 2005 from the former deputy chief to a

former cost recovery case manager [Parker] suggests that cost
recovery program management designed [WiFITER], at least in
part, to avoid state fiscal controls. Specifically, the former deputy
chief discussed using the attorneys association or another third
party to set up and manage a fund with the purpose of training and
equipping Cal Fires fire investigators. He said he would like to
see an outside organization receive the money so it could be used
in a more effective manner. He went on to say that if the State
received the money, there would be a lot of limiting factors on
how, when, and where it could be used, such as budgeting,
purchasing, and contracting limitations, and spending freezes.
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Id. at 32. The discussion of Parkers email concludes that [b]y directing and spending portions
14
of cost recovery revenues through [WiFITER] instead of following normal state processes, cost
15
recovery program management prevented Finance and the Legislature from performing their role
16
in deciding how state money should be spent, including whether some of it should be spent on
17
non-state entities. Id. at 33. Parkers email, which had never been produced by Cal Fire or the
18
United States, conflicts with his sworn testimony in the federal action regarding the purpose of
19
the fund, as Parker never disclosed it was designed to avoid state fiscal controls, and evidences
20
Cal Fires scienter in forming WIFITER.
21
Despite eventual orders by the state court in 2013 requiring Cal Fire and its counsel to
22
produce all WiFITER documents, Cal Fire withheld this critical document and thousands of other
23
documents until well after the settlement of the federal action. In fact, but for the issuance of the
24
State Auditors report, Defendants would never have learned of these documents; the United
25
States certainly never produced them.
26
Once the State Auditors report and the existence of this unproduced document became
27
public, Defendants immediately notified Cal Fire of its failure to produce this email and
28
demanded production of all responsive documents. That demand precipitated an admission by

111
Cal Fire and its attorneys that the Office of the Attorney General had failed to produce the critical
email identified by the State Auditor, and thousands of pages of additional critical WiFITER
documents. After Defendants secured a third order requiring production of all WiFITER
documents, Cal Fires attorneys belatedly produced two tranches of documents: first,
approximately 5,000 pages, and then (despite previously assuring Judge Nichols in a telephonic
hearing that there was nothing else) Cal Fire belatedly produced more than 2,000 additional
pages, many of which were directly responsive to Defendants 2010 request for production and to
Defendants subsequent requests in October 2012.59
DOWNEY BRAND LLP
Through this belated process Defendants finally obtained critical documents revealing the
10
true reason Cal Fire created WiFITER and confirming Defendants suspicions that this free
11
money, unencumbered by any State oversight or control, motivated the Moonlight investigators
12
the lead investigator himself a WiFITER beneficiary to seek out monied defendants. More
13
specifically, documents eventually produced by Cal Fires counsel, none of which were provided
14
to Defendants by the time this Court issued its pretrial rulings on motions in limine, revealed,
15
among other things, the following:
16
Cal Fire law enforcement and wildland fire investigators created WiFITER
without obtaining approval from the California Department of Finance (DOF)
as required by state law.
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18
Cal Fire established WiFITER for the purpose of facilitating Cal Fire
investigators circumvention of strict limitations in expenditure of State
general fund dollars.
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Cal Fire senior management, including those overseeing the Moonlight

investigation, strategized on how to conceal WiFITER from regulators.
22
While Cal Fire Northern Region Chief Carlson, who eventually assisted the
United States in this action, was reviewing and revising his mentee Whites
draft Moonlight Fire Joint Report in February 2008, Carlson also expressed
23
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59
It was not until after the October 15, 2013, State Auditors report, which revealed that Cal Fire and its lawyers had
withheld the most important documents, that the Office of the Attorney General finally began to provide the most
damaging documents (those most favorable to Defendants). These documents, largely in the form of internal emails,
prove the existence of a conspiracy to actively conceal WiFITER. It was this last batch of documents that also
revealed most clearly the moral hazard WiFITER created, namely the motivational bias that WiFITER instilled in fire
investigators to target affluent defendants, partially explaining the effort here to pin blame on Defendants, regardless
of evidence pointing to other parties and the damage it would cause to our system of justice.
112
concerned that WiFITER was running in the red and emphasized that the
fund would remain so, unless someone is going to make a high % recovery.
In another email that same day, Carlson denied a request to use WiFITER
funds to enhance Cal Fires ability to investigate arsonists because, he said, it
is hard to see where our arson convictions are bringing in additional cost
recovery.
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In March 2008, while concerned that the WiFITER account was running in
the red, Carlson urged other Cal Fire law enforcement personnel to divert an
even greater percentage of wildland fire settlement dollars from the states
general fund into the WiFITER account. In response, Cal Fires then lead inhouse general counsel, an officer of the Court, advised against it not because
the fund was illegal, but to prevent discovery of the fund by state regulators.
Specifically, Cal Fires general counsel stated: the point is to keep a low
profile. If we take a cut off the top of a recovery where assets are say $100K
but costs are $1 Million, that will look fishy. This advice was repeated in an
email from Cal Fires highest ranking law enforcement official in a March
2008 email to Carlson, again not because the fund was illegal, but to ensure
regulators did not discover the fund.
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Three months prior to the Moonlight Fire, lead investigator White admitted in
an email to circumventing the chain of command (CoC) so as to check on
whether WiFITER funds would allow him to get his hands on additional
WiFITER-funded equipment in this instance, an expensive computer voice
stress analyzer (CVSA). He tells the person he is writing to that he figured
[she] wouldnt rat him out for circumventing the CoC on this question
because as Alan [Carlsons] boy, I can do no wrong . . . . 60
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Cal Fires counsels failure to produce WiFITER documents enabled United

States expert witness Chris Parker, a former Cal Fire investigator and the
creator of WiFITER, to provide misleading testimony in this case about
WiFITER and its purpose and benefits, which was inconsistent with his own
wrongfully withheld January 8, 2005, internal email, which showed that
WiFITER was created to circumvent rules restricting expenditure of state
money.
The November 2009 internal WiFITER audit report produced by Cal Fire (one
of only two WiFITER documents provided to Defendants as of the federal
trial date) was a fraudulent document that supplanted earlier versions of the
audit report. Those earlier versions contained a finding that the account was
not formed in compliance with law and had never been approved.
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In other instances, Carlson and White (the lead Moonlight Investigator) strategized together about how much
money they should initially demand for the WiFITER account from their chosen defendants to perpetuate their illegal
off-books account. In one instance involving another fire only a few short months before he sent the Moonlight Fire
demand letters, White wanted to divert 20% of what Cal Fire was demanding from Defendants on that fire to
WiFITER. But Carlson, apparently heeding the advice of Cal Fires general counsel Giny Chandler to keep a low
profile, directed White to divert only 5%. White reluctantly complied, but not before pleading to Carlson: Giving
up money for the CDAA fund? Cant we wait until we get the CVSA?
113
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The finding of illegality in the first final audit report was deleted and
suppressed at the urging of law enforcement officer Carlson, shortly after the
state and federal Moonlight Fire complaints were filed in 2009.
Cal Fire ultimately and illegally siphoned approximately $3.66 million dollars
of state money into the WiFITER account between 2005 and 2012, and spent
some $2.9 million of those funds for the benefit of its wildland fire
investigatorsthe very people who, with exclusive and private access to fire
scenes, assign blame for those fires. These benefits included numerous
training events at locations including beachfront resorts in Pismo Beach and
San Diego, and expensive equipment, such as $1800 camera packages.
Many of the training events and WiFITER purchases were coordinated and
overseen, or requested by, Moonlight Fire lead investigator White, who also
attended numerous WiFITER funded events.
The CDAA merely processed the expenditure of WiFITER money as directed
by Cal Fire civil cost recovery staff and investigators, including Carlson.
Thus, the same investigators and case managers responsible for assigning
blame and recovering money for wildland fires controlled the unlawful
expenditure of millions of dollars in recovered funds.
Carlson, Cal Fires initial case manager on the Moonlight Fire prosecution,
was one of only a handful of Cal Fire staff members on a committee that made
all decisions on how to spend WiFITER money, and he suggested and
received approval for multiple expenditures of WiFITER money.
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Carlson apparently received personal payments from the WiFITER account

for his participation as an instructor at WiFITER training events, while also
receiving his salary as a state employee.
Lead investigator Whites Moonlight Fire demand letter of August 4, 2007,
which demanded the payment of $8.1 million in two separate checks, one
short-changing the State of California and the other requiring an illegal
payment to CDAA in the amount of $400,000, would have effectuated one of
the largest WiFITER cash infusions in the history of the illegal off-book
account.
In late January, 2013, after Defendants exposed WiFITER, the Wall Street
Journal, the Los Angeles Times, and the Sacramento Bee ran stories on Cal
Fires malfeasance. Thereafter, in March 2013, Cal Fires lead in-house
general counsel, who provided the above-quoted advice, was terminated.
The California Department of Finance also issued its own review of WiFITER, and
similarly concluded that Cal Fire had failed to obtain the legally required authorization for the
outside bank account, and that Cal Fire had not complied with state mandated restrictions on the
114
expenditure of state money.
Shortly after publication of that report, retired Cal Fire Law Enforcement Chief Tom
Hoffman came forward as yet another whistle blower, offering his own revealing criticism of
WiFITER and Cal Fires civil cost recovery unit responsible for the state action, stating:
I feel vindicated. I tried so hard to get centralized management of

cost recovery monies. I was stymied at every turn by the North
Region and the South Region. It became the wild west with
everyone doing their own thing. The system was doomed. Lack of
support from my management to do the right thing is what led to
my early retirement. I also recommend [sic] CALFIRE go to
Department of Finance for approval of the Wildland Investigation
and Training Fund. This was in the original draft report, but
someone wiped it out, (shortly after I retired) thereby covering up
what was the right thing to do.
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In stark contrast to these facts, the Moonlight Prosecutors recklessly disregarded the truth
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in representing to this Court through their motions in limine that WiFITER was essentially a
14
noble cause, arguing that [a] public program established to train and equip fire investigators is
15
hardly evidence of a multi-agency conspiracy; and that Defendants allegations of a conspiracy
16
are unsupported.
The Moonlight Prosecutors also recklessly misrepresented WiFITER to the Court as a
17
18
separate public trust fund. In fact, it was secret, not public. It was an off-books illegal account,
19
not a trust. It was filled with money skimmed from wildland fire settlements legally required to
20
be delivered to the states general fund. And it was controlled and spent by wildland fire
21
investigators on themselves. Thus, it was anything but separate.

The eventual disclosure of the true facts precipitated much-needed corrective action by
22
23
Californias Legislature. Specifically, Governor Brown signed into law two new pieces of
24
legislation (SB 1074 and SB 1075) which focus on addressing Cal Fires malfeasance in creating
25
and operating WiFITER.61 In an effort to ensure that other agencies would not engage in similar
26
27
28
61
This legislative action was largely symbolic, because diversion of money by state employees, as was done in Cal
Fire by numerous individuals acting in coordination, including Carlson and the Moonlight Fires lead investigator
White, was and is already a felony under California law. See Cal. Penal Code 424. But despite a request by
California State Senator Ted Gaines and others in open letters to Attorney General Kamala Harris urging her to
undertake a criminal investigation, Attorney General Harris claimed she could not take any such action because her
115
behavior, the State Controllers Office also sent notices to all state agencies calling out Cal Fires
malfeasance.
3
4
product of a fraud on the court. Indeed, Judge Nichols reached this very conclusion after finally
having in his possession a full accounting of what actually occurred with this illegal slush fund,
including documents showing the motivational bias it instilled in those involved with the
Moonlight Fire investigation, including Carlson and White.
8
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DOWNEY BRAND LLP
This Courts ruling on the Moonlight Prosecutors motion in limine was therefore the
Armed with that information in the state action, Judge Nichols reversed his ruling wherein
he had granted Cal Fires motion in limine to exclude reference to WiFITER during trial. In one
10
of his February 4, 2014, orders, he found that many of the belatedly produced documents are
11
supportive of Defendants argument that WiFITER is relevant to the question of whether
12
Moonlight Fire case manager Carlson and Moonlight Investigator (and subsequent case manager)
13
White were biased towards affixing blame on affluent defendants who could pay for Cal Fires
14
suppression costs (and who therefore could, by extension, help fund WiFITER) in order to
15
perpetuate an illegal account for which Carlson, White and others were beneficiaries.
16
The belatedly produced documents establish that these Cal Fire managers and their
17
counsel followed an agreed-upon strategy, coordinated their activities, and acted in concert to
18
minimize the possibility that the illegal account would be discovered by state regulators at the
19
Department of Finance or by opposing parties.
20
At bottom, a small cadre of Cal Fire managers and their counsel created a money-
21
skimming operation which instilled in wildland fire investigators an undisclosed personal, direct,
22
illegal and contingent beneficial interest in the outcome of their own investigations. The
23
Moonlight Prosecutors then proffered one of these law enforcement officers, White, as both a
24
percipient witness and as an expert witness in the federal Moonlight Fire action, and submitted an
25
extensive expert declaration from him to this Court, all without ever disclosing to the Court or
26
Defendants his contingent financial interest.
27
28
office represented Cal Fire.
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Analysis
Here, the existence of WiFITER and the moral hazard it represents, the Moonlight
Prosecutors reckless misrepresentations to the District Court concerning its true nature, and the
joint prosecutions concealment of it from Defendants collectively establish three distinct frauds
upon this Court.
a.
DOWNEY BRAND LLP
The Moonlight Prosecutors Misrepresentations to the Court Concerning

WiFITER Constituted a Fraud Upon the Court.
The Moonlight Prosecutors intentional misconduct with regard to WiFITER was not just
a failure to disclose the WiFITER account to Defendants. The Moonlight Prosecutors also made
10
recklessly false representations about WiFITER to the Court in support of their motion in limine
11
to preclude Defendants from arguing that there was any government conspiracy. This Court
12
relied upon the Moonlight Prosecutors recklessly false representations in granting that motion.
13
Given that they asked the Court to engage in a careful balancing of interests and evidence, the
14
Moonlight Prosecutors duty of candor to the Court required them to ensure that the Court had a
15
full and complete record upon which to base its rulings. Cf. Shaffer, 11 F.3d 457-58 (discussing
16
duty of candor to court). Instead, the Moonlight Prosecutors defrauded the Court by grossly
17
misrepresenting the true nature of WiFITER, thereby inducing the Court to make erroneous
18
rulings in reliance thereon. Demjanjuk, 10 F.3d at 353-54 (holding that government attorneys
19
reckless disregard for the truth is sufficient to establish a fraud on the court).
20
In view of Whites contingent interest in the case, a fraud upon the Court was committed
21
when the Moonlight Prosecutors filed the expert declaration of White in opposition to
22
Defendants motion for summary judgment. Whites declaration is replete with, among other
23
things, purported expert opinions regarding the ignition and supposed early spread of the
24
Moonlight Fire from an alleged incipient stage to the free burning stage, all in an effort by the
25
Moonlight Investigators to reverse engineer, or back into, a time of ignition that coincides with
26
a time when a Howell bulldozer was in that general vicinity. As addressed in detail elsewhere,
27
Whites perjured testimony and false declaration constitute fraud going to the central issue in the
28
action. But given the belated disclosures of WiFITER documents to Defendants, it is now clear
117
that the Moonlight Prosecutors submission of Whites expert declaration to the Court was also in
direct contravention of California Rule of Professional Conduct, Rule 7-107(C), which prohibits
testifying experts from having a contingent interest in the outcome of the action in which they are
testifying. By concealing from the Court Whites undisclosed contingent interest in the action
through WiFITER, White himself, through the Moonlight Prosecutors, defrauded this Court.
In their portion of the Joint Status Report, the Moonlight Prosecutors state,
counterfactually, that they made no misrepresentation to the Court. (Docket No. 612 at 19:2-
3.) This assertion is clearly incorrect. As demonstrated here, the Moonlight Prosecutors in fact
misrepresented the nature of WiFITER to the Court, aided and abetted by their joint prosecution
10
partners, who were simultaneously withholding the very documents and evidence that belied the
11
Moonlight Prosecutors false representations.
DOWNEY BRAND LLP
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b.
13
14
Concealment of the Motivational Bias Created by WiFITER Constituted a

Even if there was no joint prosecution agreement binding the federal and state
15
prosecutors, and even assuming, arguendo, that the Moonlight Prosecutors made no
16
misrepresentations about WiFITER to this Court, the judgment should nonetheless be vacated and
17
the case dismissed as a result of the fraud upon this Court committed by Cal Fires general
18
counsel and litigation counsel who were also officers of this Court under Ninth Circuit precedent.
19
See Pumphrey, 62 F.3d at 1130-31 (holding that in-house counsel, even though not counsel of
20
record and not admitted pro hac vice, was officer of the Court for purposes of Rule 60 analysis).
21
Fraud perpetrated so thoroughly and on such a broad scale is not confined to one tribunal
22
when it is based on a joint investigation and joint prosecution. Cal Fires investigators and
23
attorneys plainly knew that their actions and decisions to disclose or not disclose evidence
24
favorable to the defense had a direct and material effect on the concurrent federal Moonlight
25
proceedings, and their fraud necessarily extended to this Court.62
26
62
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28
The Moonlight Prosecutors listed White and Reynolds as expert witnesses. The Moonlight Prosecutors then
asserted that, in view of its Joint Prosecution Agreement with Cal Fire, it had no obligation to produce what it
claimed were privileged communications with these experts germane to their opinions. On May 26, 2011, Magistrate
Judge Brennan entered an order granting Defendants Motion to Compel production by the United States, despite
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DOWNEY BRAND LLP
As the investigating agency upon which the federal prosecution relied, Cal Fire and its
counsel (who are undoubtedly officers of the Court) had a constitutional obligation under Brady
to disclose material evidence. Both the Ninth Circuit and the Supreme Court have recognized
that exculpatory evidence cannot be kept out of the hands of the defense just because the
prosecutor does not have it, where an investigating agency does. Tennison, 570 F.3d at 1087
(quoting Blanco, 392 F.3d at 388). Such a rule would undermine Brady by allowing the
investigating agency to prevent production by keeping a report out of the prosecutors hands until
the agency decided the prosecutor ought to have it, and by allowing the prosecutor to tell the
investigators not to give him certain materials unless he asked for them. Id. (quoting Blanco,
10
392 F.3d at 388). The Supreme Court has also made clear that Brady suppression occurs when
11
the government fails to turn over even evidence that is known only to police investigators and
12
not to the prosecutor. Youngblood, 547 U.S. at 869-70 (quoting Kyles, 514 U.S. at 438).
13
Accordingly, regardless of whether the federal prosecutors even possessed WiFITER
14
evidence material to the defense, Cal Fire as the investigating agency and the federal
15
prosecution teams joint prosecution partner clearly possessed such evidence and had a duty to
16
disclose that evidence to the Court and Defendants, at least in connection with a motion to compel
17
all documents germane to the investigators opinions, which this Court granted. (Docket No.
18
210.)63 Cal Fires general counsel and litigation counsel, officers of the Court, also had a duty to
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finding that [t]he USAO and the AGO have entered into a joint prosecution agreement. Defendants also served a
Rule 45 document subpoena on Cal Fire, seeking documents pertaining to White and Reynolds expert opinions for
the United States. Cal Fire similarly refused to produce documents, and on November 8, 2011, Magistrate Judge
Brennan entered an order on Cal Fires motion for protective order. In ordering Cal Fire to comply with much of the
subpoena, Judge Brennan again found that Cal Fire and the United States had voluntarily entered into a joint
prosecution agreement and that Cal Fire was reaping the benefits of that arrangement. Judge Brennan also ruled
that discoverability of the expert files turned on whether the documents are germane to the subject matter on which
the expert has offered an opinion. Certainly, counsel for Cal Fire and the United States were obligated to disclose to
the Court the WiFITER program and Whites role within it. It is difficult to imagine material more germane to an
expert opinion than a contingent financial/beneficial interest in the investigation/outcome. Yet the Moonlight
Prosecutors failed to disclose any of it, and instead defended the WiFITER program.
63
Any question of whether the federal prosecution team considered Cal Fire to be the lead investigating agency was
answered when the United States served its trial witness list. The United States witness list had two sections. The
first section was a listing of those witnesses the United States absolutely intended to call. The United States included
lead Moonlight Investigator White of Cal Fire in that section. He is the only Moonlight Investigator listed. The
United States provisional witness list/section included witnesses that may be called if the need arises. USFS fire
investigator Welton can be found only in this section.
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ensure this jointly prosecuted action did not work a fraud upon any court. See Pumphrey, 62 F.3d
at 1130-31. Nevertheless, Cal Fires in-house counsel, with the cooperation of Cal Fires
litigation counsel, actively suppressed evidence of WiFITERs illegality and its impact on
wildland fire investigations, thereby defrauding this Court. See Derzack, 173 F.R.D. at 416
(finding fraud upon the Court arising from discovery abuses and lack of candor, even where
fraudulent documents had not been submitted to the court).
c.
DOWNEY BRAND LLP
The Existence of WiFITER Constitutes a Fraud Upon the Court.
First, the imperative of judicial integrity as articulated by the Supreme Court in Mapp v.
Ohio, 367 U.S. at 659, cannot possibly tolerate circumstances where law enforcement officers
10
have any undisclosed contingent beneficial interest in an investigation which is the basis for
11
governmental prosecution.64 The judicial process, particularly government prosecutions that
12
depend entirely on law enforcement officers to provide both percipient and expert opinions,
13
necessarily places tremendous trust in these law enforcement officers. Such was certainly the
14
case here. The Court necessarily presumes these officers are serving the public trust and fulfilling
15
their law enforcement oaths to defend the constitution and protect the innocent. When law
16
enforcement officers instead have a concealed financial bias driven by an undisclosed contingent
17
interest in the outcome of their investigation and a lawsuit derived from it, the judicial
18
machinery cannot perform in the usual manner its impartial task of adjudging cases that are
19
present for adjudication. Intermagnetics, 926 F.2d at 916 (quoting 7 James Wm. Moore & J.
20
Lucas, Moores Federal Practice 60.33 (2d ed. 1978)).
21
California Rule of Professional Conduct 7-107(C) absolutely prohibits proffering expert
22
witnesses in litigation on a contingency basis where the amount of their compensation depends on
23
the outcome of the action. This prohibition is founded upon nearly a century of case authority.
24
64
25
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27
In this regard, on February 7, 2013, former Eastern District of California Assistant United States Attorney and
Civil Chief Matthew Jacobs, now General Counsel for CalPers, published an article in the Sacramento Bee and
elsewhere deriding the practice of creating financial incentives for investigators and prosecutors, indicating how the
practice is widely condemned and raising the very concerns expressed herein by Defendants relating to the
motivational biases created by such practices. The article may now be found at
http://www.mercedsunstar.com/news/state/article3274403.html.
28
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It is the contingency on the one hand and the agreement to furnish a

given set of facts essential to a successful litigation on the other,
and both of which in their nature are calculated to induce false
charges and the production of perjured testimony, to subvert the
truth and pervert justice through fraud, trickery, and chicanery at
the hands of unscrupulous private detectives or other conscienceless
persons, which has impelled the law, with wisdom, to declare such
contracts illegal.
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5
6
Von Kesler v. Baker, 131 Cal. App. 654, 657 (1933) (quoting Hare v. McGue 178 Cal. 740
(1918)). This prohibition applies with full force even if the existence of an experts contingent
interest is disclosed in the course of the action. See Cal. R. Prof. Conduct 7-107(C).
DOWNEY BRAND LLP
Here, the lead investigating agency Cal Fire and lead investigator White clearly had a
10
contingent interest in the outcome of their investigation by virtue of WiFITER, as evidenced by
11
Whites letter to Defendants demanding a $400,000 cash infusion for the off-books account of
12
which he was a beneficiary. That the contingent interest in this case was concealed makes it all
13
the worse.
14
To the extent the Moonlight Prosecutors attempt to argue that the motivations and biases
15
of Cal Fire investigators are irrelevant to the federal action, this argument is incorrect. A single
16
joint investigation served as the foundation for both the federal and state actions. The Moonlight
17
Investigators gave testimony that would be used in trials of both actions. Accordingly, the lead
18
investigators contingent interest in the outcome of the state action created a financially driven
19
bias that necessarily infected both actions to an equal degree. Moreover, the Moonlight
20
Prosecutors voluntarily elected to undertake a joint investigation and prosecution of the
21
Moonlight Fire with Cal Fire and its attorneys. At every point along the path of the concurrent
22
state and federal actions, the Moonlight Prosecutors availed themselves of the benefits of a joint
23
prosecution and the evidentiary privileges associated with it. Given that the state and federal
24
prosecutors aided and abetted one another in the prosecution of both actions, any failure to
25
disclose critical facts associated with the WiFITER account are failures of the entire joint
26
prosecution team. The Moonlight Prosecutors cannot seize the benefits of their common
27
interest at every turn with Cal Fire and now distance themselves from the acts of their joint
28
prosecution partners. As in any joint venture, both parties become responsible for the acts of the
121
other.
10.
3
4
The Moonlight Prosecutors Concealed from the Court and Defendants

Percipient Witness Edwin Bauers False Report of a Two Million Dollar
Bribe, Which Enabled Them to Obtain a Favorable Pretrial Ruling on a
Material Issue, Thereby Committing a Fraud on the Court.
The Relevant Facts
5
6
The Moonlight Fire began on Labor Day, September 3, 2007, deep in the woods about ten
miles from Westwood, California, which is the nearest town. Almost immediately after this
action was filed, Defendants discovered evidence that the Moonlight Investigators ignored and
suppressed evidence tending to prove that a Westwood local, Ryan Bauer, was a potential cause
10
of the Moonlight Fire.65 Thus, Defendants focused much of their discovery efforts on uncovering
11
the facts regarding Bauer and his whereabouts and activities on the day of the fire.
DOWNEY BRAND LLP
12
Bauer woke up on the morning of September 3 and called his parents Edwin and Jennifer
13
to tell them that he was planning on going out to cut firewood that day. As a knot bumper for
14
Howell (a low-level position working at landings of logging sites), Bauer had Labor Day off.
15
Bauer ran his own side business cutting and selling firewood cords, which helped support
16
his expensive drug habit. In fact, he testified in his deposition that he was high on four different
17
narcotics on the day of the fire. He also testified that his favorite place to scout for and cut
18
firewood was in the Cooks Creek area, a forested area located south of Westwood where Howell
19
conducted logging operations in the weeks before the Moonlight Fire erupted.
20
Bauer had a personal hot-rodded chain saw, which is a modified machine with greater
21
horsepower and a lack of key fire safety components such as spark arrestors. Because these
22
chainsaws are not fire-safe, Bauer was forbidden from using his when working for Howell, which
23
had an exemplary safety record. But Howell had no control over Bauers use of dangerous
24
chainsaws on his days off.
25
During his deposition, Bauer circled an area around Cooks Creek as his chosen location to
26
27
28
65
That the government did not investigate Ryan Bauer, an individual unable to pay any damages, was consistent with
lead Moonlight Investigator Whites status as a recipient of various benefits associated with Cal Fires illegal
WiFITER slush fund. The same can be said about the investigators failure to investigate Michael McNeil.
122
1
2
Shortly after the first report of the fire at 2:24 p.m., a private patrolman found Bauers
parents driving alone deep in the woods, approximately one-half mile from where the fire began,
searching for their son and expressing concern for his safety. They claimed they spotted the
smoke plume from a nearby meadow several miles away and began searching for their son, whom
they understood was cutting wood in the area, corroborating what he had told them that morning.
DOWNEY BRAND LLP
scout firewood for his side business. This is the same area where the Moonlight Fire began.
At about the same time, a Lassen County deputy sheriff encountered and stopped Ryan
Bauer in a nearby meadow as he sped away (like a bat out of hell, according to the deputy)
from the area of the fire shortly after it started, as he headed back toward the town of Westwood.
10
Bauer was highly agitated and had a chainsaw in the back of his pickup. Bauer told the deputy
11
sheriff that he was in the area where the fire was burning to retrieve his chainsaw.
12
Four days later, on September 7, 2007, Cal Fire employees assisting with the investigation
13
interviewed Ryan Bauer at the Cal Fire station in Westwood. During his interview with Cal Fire,
14
Ryan Bauer offered an unsolicited alibi blurting out, I was with my girlfriend all day. She can
15
verify that if Im being blamed for the fire. This statement was false.
16
The Moonlight Investigators intentionally failed to interview Ryan Bauers girlfriend,
17
Andrea Terry (Terry). During the litigation, Defendants tracked her down and took her
18
deposition. She testified that Bauer was not with her all day, but instead showed up mid-day,
19
dirty and with sawdust on his clothing, with a chainsaw in his pickup. At the time of the fire,
20
Terry lived in Westwood only a few hundred feet from the fire station where Cal Fire interviewed
21
Bauer, some ten miles from the fires origin.
22
Terry testified that Bauer, shortly after he arrived at her home and in her presence,
23
suddenly claimed to have spotted the smoke plume of the fire in its early stages from ten miles
24
away. Terry found it odd that Bauer saw a plume of smoke she could hardly see, and that he
25
inexplicably just knew right off the bat that [t]hats where we [Howells crew] are working.
26
Ms. Terrys parents also confirmed during their depositions that Bauer was at their home only for
27
a short while, and that he had not been at their home all day.
28
Bauer lied to the investigators during his interview about other issues as well, including
123
that, on the day of the fire, an officer in a red fire engine helped to retrieve a chain saw that Bauer
had stashed behind a tree in the area where the fire began. Later, during his deposition, when
asked about whether he stashed a chainsaw in the area of the fire, Bauer contradicted himself,
saying he had not stashed any chainsaws on the mountainside that day. This also contradicted the
story he told to the deputy sheriff as he sped away from the fire.
DOWNEY BRAND LLP
During his September 7th interview, Bauer suddenly insisted that the investigators turn off
their recorder, so that he could reveal certain information in confidence. At that point in time,
according to the investigators, Bauer told them that he had overheard two of Howells bulldozer
operators in a nearby meadow several hours after the fire had been reported, blaming one another
10
for having caused the fire. Curiously, Bauer is the only person to have overheard this alleged
11
conversation. This statement by Bauer was also false, as both bulldozer operators denied having
12
had such a conversation.
13
14
15
Eventually, during his deposition, Bauer asserted the Fifth Amendment in response to
questions concerning his potential involvement in the start of the fire.
The investigators also interviewed Ryan Bauers father, Edwin Bauer, on September 7,
16
2007. During his interview, Edwin Bauer also attempted to blame one of Howells bulldozer
17
operators for the fire. In this regard, he claimed that as he and his wife were driving out of the
18
woods after searching for their son, they encountered one of the dozer operators driving a silver
19
pickup. Edwin Bauer claimed that he stopped and asked the operator how the fire started.
20
According to Bauer, the bulldozer operator replied that a bulldozer hit a rock. Mr. Bauer is the
21
only witness to this alleged admission. This statement by Edwin Bauer was false, and Bauer was
22
never asked to explain how the Howell bulldozer operator could have reached such a conclusion
23
two days before even the Moonlight Investigators had processed the scene of the alleged origin.
24
At no time following the interview of either Ryan or Edwin Bauer did the investigators
25
ever follow up with Howells bulldozer operators to inquire about whether either of them had
26
made any such statements to either of the Bauers. The Moonlight Investigators apparently never
27
scrutinized the illogical Bauer allegations. For instance, assuming the bulldozer operators had
28
made such statements, they were never asked how they could have known that the fire started as a
124
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1
result of a bulldozer striking a rock unless they had witnessed the ignition. Assuming they
witnessed the ignition, they were never asked why it was that they were unable to suppress the
fire immediately in its infancy, just as one would extinguish a cigarette.66 Howells bulldozer
operators deny having made any such implausible statements to either of the Bauers, and deny
ever believing that the fire started when a bulldozer hit a rock.
The Moonlight Investigators intentionally prepared misleading witness interview
summaries for both Ryan Bauer and Edwin Bauer. Each interview summary included the alleged
admissions by the bulldozer operators. But curiously, the summary of the interview of Ryan
Bauer omitted altogether his unsolicited false alibi, and contains no discussion or analysis of his
10
many other false statements. The summary of the interview with Edwin Bauer confirms that he
11
and his wife encountered a patrolman while searching for their son, but the summary fails to
12
describe just how deep into the woods (some ten miles from the town of Westwood) and how
13
close to the origin of the fire (only a half mile) Edwin Bauer and his wife were at that time of the
14
encounter. The image below illustrates the location where the Bauers were spotted in close
15
proximity to the fire, less than a half-mile from the origin, some ten miles from civilization.
16
17
18
19
20
21
22
23
24
25
Armed with the foregoing facts, all of which were known to Defendants before the
26
27
66
28
The Joint Report claims that the fire ignited at 12:15 p.m., but remained in an incipient state until it burst into
flames sometime around 2:00 p.m.
125
settlement of the federal action, Defendants approached the federal trial with the intent of
presenting these facts, among others, to demonstrate an alternative potential cause of the fire. In
this regard, Defendants never limited their alternative theory regarding the Bauers to arson, and
always intended to argue that one or more of the Bauers may have caused the fire either
intentionally or unintentionally, whether via arson, with a chainsaw, spilled gasoline, or through
careless smoking.
DOWNEY BRAND LLP
On May 31, 2012, the Moonlight Prosecutors filed various motions in limine in a
calculated effort to keep much of the evidence relating to the Bauers away from the jury. In
making this motion, the Moonlight Prosecutors misrepresented to the Court that there was not a
10
shred of evidence tending to show the Bauers may have caused the fire, and asked the court to
11
exclude such argument after engaging in a careful balancing of the evidence under Federal Rule
12
of Evidence 403 (A court may exclude evidence, even if relevant, whose probative value is
13
substantially outweighed by the risk of unfair prejudice, confusing the issues, misleading the jury,
14
undue delay, and wasting time.).
15
Defendants opposed the motion as being contrary to law and evidence. With respect to
16
the Bauers, Defendants presented the Court with the facts known to them at that time, and argued
17
that they were entitled to present them to the jury and that it was within the province of the jury to
18
consider alternative potential causes of the fire.
19
Having received the parties briefing, the Court engaged in a careful balancing of the
20
evidence under Federal Rule of Evidence 403 and, in doing so, relied upon the United States
21
representations that there was not a shred of evidence tending to show that one or more of the
22
Bauers may have been responsible for the fire. As a consequence, during the June 26, 2012, Final
23
Pretrial Conference and motion hearing, the Court granted the United States motion regarding
24
other potential causes, and reiterated its rulings in its Final Pretrial Order. Specifically, the Court
25
ordered that Defendants may not elicit evidence to argue that someone else started the fire.
26
The Courts ruling prohibiting Defendants from eliciting evidence to argue that someone
27
else started the fire was a critical ruling that was a substantial factor in forcing Defendants to
28
settle the federal action.

126
1
2
before the Moonlight Prosecutors filed their motions in limine in the federal action, they were in
possession of, and had intentionally failed to disclose to the Court and Defendants, critical
evidence regarding an illegal scheme on the part of Edwin Bauer and/or his son Ryan Bauer,
which tended to demonstrate the Bauers potential involvement in the ignition of the fire, and
which was directly relevant to the Courts careful balancing under Rule 403, and which directly
contradicted their misrepresentation to the Court that there was not a shred of evidence.
8
9
DOWNEY BRAND LLP
Long after the settlement and dismissal of the federal action, Defendants learned that
Specifically, in November of 2013, while Defendants were working on various motions

that led to the termination of Cal Fires state court action, counsel for Sierra Pacific received a
10
telephone call from Edwin Bauer. Edwin Bauer ostensibly called to request the return of
11
documents Defendants had copied from his hard drive pursuant to a court order issued in the state
12
action. During that telephone call, Edwin Bauer made a surprise comment about a $2 million
13
bribe. When Sierra Pacifics counsel immediately sought more information, Edwin Bauer
14
claimed that Eugene Chittock, the lawyer he had retained to represent his son Ryan during Ryans
15
deposition, had told him that Downey Brand or Sierra Pacific had offered his son a $2 million
16
bribe if Ryan would state that he had started the Moonlight Fire. Edwin Bauer also revealed that
17
he had told lead Moonlight Prosecutors Taylor and Richard Elias that his son had been bribed
18
when those two prosecutors personally delivered a trial subpoena to him in advance of the federal
19
trial. Edwin Bauer said he filed a police report, and that the FBI had interviewed him and Mr.
20
Chittock.
21
The next day, Sierra Pacifics counsel contacted Mr. Chittock to ask him about Mr.
22
Bauers story. Mr. Chittock said that he had absolutely not conveyed any bribe offer, but that
23
one of the Bauers had apparently made that claim to federal employees working on this case. Mr.
24
Chittock stated that he had been contacted by two federal investigators or lawyers. Mr. Chittock
25
stated that these two individuals, a man and a woman, came to his office in the spring of 2012,
26
telling him that Ryan Bauers parents had stated that Mr. Chittock conveyed the offer of a bribe to
27
their son Ryan in the amount of $2 million and that the money would be coming from Downey
28
Brand or Sierra Pacific.

127
1
2
agreed to allow them to search his phone records and files. Mr. Chittock informed the federal
employees that all they would find was a record of a single phone call he had received from
Sierra Pacifics counsel Warne, who was in the process of scheduling the continued deposition of
Ryan Bauer within Susanvilles adult detention facility, as Bauer was there serving a term for
assaulting a police officer. Mr. Chittock described this single call as a predictable and normal
event before the federal agents began their search. After finding nothing beyond a record of that
single call, the federal employees left.
DOWNEY BRAND LLP
Mr. Chittock told the investigators that the charge was absolutely false, and he readily
Defendants are informed and believe that, because neither they nor Sierra Pacific were
10
ever interviewed or investigated about the alleged bribe, the federal investigators and the
11
Moonlight Prosecutors concluded that Bauers claim was false, which of course it was. As a
12
result, Defendants are informed and believe that Edwin Bauer violated, at a bare minimum, 18
13
U.S.C. 1001 by making a false report to a federal agent, which is a felony.
14
The Moonlight Prosecutors knowingly and willfully failed to reveal to the Court and
15
Defendants the fact that Edwin Bauer had made the false claim that Mr. Chittock had
16
communicated a $2 million bribe to his son Ryan Bauer, nor did the Moonlight Prosecutors reveal
17
the fact that Mr. Chittock denied the allegation and that they were unable to obtain any evidence
18
supporting Bauers claim. The Moonlight Prosecutors knowingly and willfully failed to reveal
19
the existence of a federal investigation into the matter concerning the Bauers, even after the
20
investigation revealed the falsity of the charges.
21
Revealing such information to Defendants or to the Court would have been damaging to
22
the governments case, as it would have tended to prove that Edwin Bauer made a false assertion
23
to strengthen the governments claims against Sierra Pacific while diverting attention from his
24
son. Obviously, had it been true, it would have been more serious than the charges set forth in the
25
federal action. Since it is not true, the false report of such a crime is also serious, demonstrating,
26
among other things, a willingness on the part of the Bauers to manufacture evidence harmful to an
27
innocent party and an effort to deflect attention away from someone who may have actually
28
started the fire. Bauers false claim raised numerous questions, including whether the Bauers had
128
engaged in similar conduct when Edwin Bauer told investigators that a man in a silver pickup had
told him that a bulldozer hit a rock, and when Ryan Bauer claimed that he too had overheard a
different statement by one of Howells bulldozer operators supposedly admitting to having started
the fire by striking a rock with his dozer.
Edwin Bauers false allegation of a multi-million dollar bribe by Downey Brand or Sierra
Pacific can only have been made in an effort to falsely inculpate Sierra Pacific, and thus it
actually has the opposite effect, tending instead to incriminate Mr. Bauer and his son Ryan as a
failed attempt to deflect focused attention from themselves and whatever role they had in starting
the Moonlight Fire. But instead of receiving this information, which is harmful to the
10
governments case, the Court and Defendants heard and received nothing in just one of many
11
instances of the government purposefully withholding harmful evidence.67
DOWNEY BRAND LLP
12
Defendants are informed and believe that had the Court been apprised of all the relevant
13
information concerning the Bauers, the Court would not have granted the Moonlight Prosecutors
14
motion in limine, and would not have foreclosed argument or evidence from Defendants during
15
trial regarding other potential causes of the fire. The Moonlight Prosecutors successful efforts to
16
purposefully mislead the Court in this manner were also an important component of their broader
17
stratagem to defraud the Court by abusing the Courts processes on numerous fronts to coerce a
18
settlement from Defendants.
19
The Bauer evidence concealed by the Moonlight Prosecutors goes to the central issue in
20
the Moonlight Fire federal action namely, who ignited the fire. All of the foregoing actions by
21
the Moonlight Prosecutors were undertaken intentionally and with malice, with actual knowledge
22
that their actions violated the due process rights of Defendants, and violated their duty of candor
23
to the Court.
24
Only through a chance telephone call during which Edwin Bauer made an off-the- cuff
25
comment in November of 2013, more than a year after the conclusion of the federal action, did
26
27
28
67
Defendants had earlier in the case requested, under Rule 34, production of all interview statements and documents
concerning the Moonlight Fire investigation, and all communications with the Bauers. To date, none of the
governments investigatory files concerning its investigation of the alleged bribe have ever been produced.
129
Defendants begin to learn of this particular aspect of the Moonlight Prosecutors fraud on the
Court.
Analysis
Standing alone, the Moonlight Prosecutors successful motion in limine precluding
Defendants argument regarding other potential causes of the fire, made while the Moonlight
Prosecutors were intentionally concealing evidence material to the Courts ruling, separately
constitutes fraud upon the Court and warrants relief under Rule 60(d)(3), setting aside the
judgment. In this regard, the Moonlight Prosecutors persuaded the Court to engage in a careful
balancing of the evidence under Federal Rule of Evidence 403, knowing that they had
10
intentionally deprived the Court of critical pieces of evidence that necessarily would have been an
11
important component of the Courts assessment.
DOWNEY BRAND LLP
12
By engaging in the foregoing conduct, the Moonlight Prosecutors engaged in an an
13
unconscionable plan or scheme designed to improperly influence the court in its decisions,
14
and engaged in a scheme perpetrated by officers of the court so that the judicial machinery
15
cannot perform in the usual manner its impartial task of adjudging cases that are present for
16
adjudication. Although under controlling Ninth Circuit authority mere attempts to defraud the
17
Court is sufficient to establish fraud on the Court under Rule 60(d)(3), Pumphrey, 62 F.3d at
18
1131, the Moonlight Prosecutors succeeded in their attempt by actually misleading the Court, and
19
through their misconduct procured a favorable and erroneous legal ruling that was a substantial
20
factor in forcing Defendants to settle the action.
21
The failure by the federal prosecutors to comply with these obligations and rules
22
constitutes a fraud on the Court for another reason: this conduct was a knowing and potentially
23
criminal attempt to hinder the judicial process, the subsequent suppression of which further
24
tainted the Moonlight Fire prosecution while prejudicing Defendants. Stonehill, 660 F.3d at 445
25
(stating that fraud on the court exists where the fraudulent conduct harm[ed] the integrity of the
26
judicial process); see also Chambers, 501 U.S. at 44 (stating that tampering with the
27
administration of justice . . . [is] a wrong against the institutions set up to protect and safeguard
28
the public). By intentionally concealing from the Court information concerning the Bauers
130
false claim of a $2 million bribe, which itself was a felony, while simultaneously representing to
the Court in the context of their critical motion in limine that there was not a shred of evidence
supporting a claim against the Bauers, the Moonlight Prosecutors clearly defrauded the Court. Id.
4
5
federal investigators regarding an alleged bribe, the Moonlight Prosecutors not only knowingly
violated their duty of candor to the Court, they knowingly violated their duties under Brady to
disclose evidence that may be favorable to Defendants, and they violated their ongoing duty to
supplement discovery responses under Rule 26 during the pendency of the case. That duty to
update discovery responses persists even after the close of formal discovery under Rule 26.
10
DOWNEY BRAND LLP
Moreover, by concealing the evidence that Edwin Bauer had made false statements to
In view of these circumstances, the Moonlight Prosecutors statement in their portion of
11
the Joint Status Report to this Court that the United States made no misrepresentations and
12
presented no false evidence is itself yet another misrepresentation. Certainly the Moonlight
13
Prosecutors representation to the Court that there was not a shred of evidence was a
14
misrepresentation. Moreover, just as in Pumphrey, Schaffer, Levander, Hazel-Atlas, and
15
Demjanjuk, they obviously violated their duty of candor to the Court (and their obligations under
16
Rule 26 to Defendants) by making that representation while concealing contrary facts critical to
17
the Courts balancing of interests under Federal Rule of Evidence 403. Here, the facts are that
18
much more egregious because there is no question that this fraud was intentional inasmuch as
19
Edwin Bauer first reported the alleged bribe to the lead Moonlight Prosecutors personally.
20
IV. THE MOONLIGHT PROSECUTORS MULTIPLE INSTANCES OF MISCONDUCT

COLLECTIVELY CONSTITUTE FRAUD ON THE COURT.
21
22
Defendants brief describes in detail certain types of misconduct by the Moonlight
23
Prosecutors. Various courts have found that each of these types of misconduct can independently
24
constitute fraud on the court under Rule 60(d)(3). But even if the Court were to conclude that no
25
discrete sequence of events was sufficient to constitute on its own a fraud on the Court, the
26
analysis most certainly would not end there. Fraud on the court may also be found by assessing
27
various acts of misconduct that, when taken together over the entire course of litigation, rise to
28
the level of a fraud on the court. See Stonehill, 660 F.3d at 446-52 (analyzing seven separate
131
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instances of litigation malfeasance in isolation to determine whether each of those instances
constituted a fraud upon the court, and after answering that inquiry in the negative, analyzing
whether the allegations as a whole amounted to fraud on the court); see also Pumphrey, 62 F.3d
at 1133 (listing a series of steps undertaken by general counsel which, taken together, constituted
fraud on the court). As the Ninth Circuit recognized in Stonehill, a fraud on the court occurs
when the alleged conduct, considered in its totality, changes the story . . . presented to the
district court, or alternatively, when that conduct substantially undermine[s] the judicial process
by preventing the [court] from analyzing the case. 660 F.3d at 452, 454.
Considered as a whole, the Moonlight Prosecutors conduct not only meets the applicable
10
standards, but far exceeds any evidentiary threshold associated with showing grave damage to the
11
integrity of our judicial system. Indeed, beyond committing a single act of fraud on the court,
12
such as was the case in Hazel-Atlas, the prosecutors here conceived of and engaged in a series of
13
interconnected acts all driven by a perverted desire to win at any cost that dramatically
14
changed the story heard by this Court and substantially undermined the judicial process. This
15
long-running deception started well before the case was filed, as the Moonlight Prosecutors
16
conduct extended into the realm of this Court a fraud that began before the litigation was filed.
17
Shortly after the lawsuit was filed, and certainly after Shelledy removed Wright from the action,
18
the Moonlight Prosecutors advanced the fraudulent report into this Courts purview and then sat
19
on their hands as their star witnesses lied repeatedly under oath regarding the centerpiece of their
20
case against Defendants. When the Moonlight Investigators deception was exposed, instead of
21
demanding answers, the federal stewards of justice told the investigators that it was a non-issue.
22
Unfortunately, the fraudulent conduct does not end there. Among the numerous acts of
23
fraud and deception, the Moonlight Prosecutors: advanced a false confession by Bush; prepared
24
and presented a false declaration to the Court in law and motion practice; participated in the
25
creation of a new fire spread diagram in an effort to obfuscate the truth about the location of the
26
origin; instructed an expert not to produce a corrected report when they discovered using the
27
correct data would be harmful to the United States; failed to produce to the defense exculpatory
28
expert notes and expert work product; advocated the existence of three other fraudulent fire
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investigations in order to help pin the blame on Defendants; attempted to conceal and cover up
information harmful to the government regarding egregious conduct at the Red Rock Lookout
Tower; allowed various Red Rock witnesses to lie under oath; falsified verified responses to
interrogatories and requests for admissions; made reckless misrepresentations to the Court
regarding evidence of Whites bias and financial motivation; failed to disclose an alleged bribe
that destroyed the credibility of a key witnesses; and presented to the Court through a false
declaration the Joint Report, and all of its misrepresentations and material omissions after the
corruption inherent in each of these documents had been exposed through discovery. This fraud
was pervasive and directed to every important issue in the case, including issues such as whether
10
the fire started where the government contended or in the manner the government contended, and
11
more fundamentally, whether Defendants were legally responsible for the Moonlight Fire or
12
whether certain affirmative defenses barred relief by the United States.
13
Moreover, although finding fraud upon the court most certainly does not require a
14
showing of knowing and intentional participation by counsel, and can be satisfied by a reckless
15
disregard for the truth, there can be no doubt that the Moonlight Prosecutors engaged in this
16
misconduct intentionally. While the government could perhaps try to chalk up a single, isolated
17
incident to an unintentional mistake, the broad tapestry of misconduct in this case defies such
18
description. 68 The transgressions and instances of prosecutorial misconduct here are simply too
19
numerous, relate to too many critical issues, and are so pervasive throughout the litigation to have
20
been the product of incompetence. There is only one inescapable conclusion: the Moonlight
21
Prosecutors knowingly and willfully engaged in each of the acts described herein as part of an
22
unconscionable plan or scheme to improperly influence the Court and affect the outcome of the
23
litigation.
24
Indeed, the Moonlight Prosecutors engaged in what can only be described as a pattern and
25
68
26
27
28
Judge Nichols also viewed the fraud as a whole. In his twenty-six page Order, His Honor found, In making this
order and in addressing the issues as set forth, it is always possible that a party that sees itself as aggrieved might
point to some individual point or points, and argue at length that the Courts determination is wrong. Because this
Courts painstaking review considered the entire record of the proceedings, the Court views this exercise as pulling at
a thread or threads in a huge tapestry or looking at a scuff or misplaced stroke in a mural. The big picture still stands
out clearly.
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practice of fraud in the Moonlight litigation. While the facts of malfeasance certainly support the
conclusion that these acts were willful, additional corroborating evidence is abundant, including
what has been revealed by Wright and Overby, two former prosecutors assigned to the case.
Despite receiving accolades for his work, Shelledy removed Wright from the Moonlight Fire after
Wright refused, in other fire cases, to succumb to pressure to withhold information harmful to the
United States. It can be no coincidence that after the government removed Wright from the
Moonlight Fire litigation that the Moonlight Prosecutors did, in fact, withhold information
harmful to the United States.69 But Wright was not the only government prosecutor who felt
pressured to engage in unethical conduct as a lawyer. Overby left the case in disgust,
10
exasperated at his inability to work within the ranks of the Moonlight Prosecutors to steer the case
11
toward the pursuit of justice. His experience also serves to confirm that the conduct of the
12
Moonlight Prosecutors was not a mere mistake, but intentionally effectuated.
13
In sum, the Moonlight Prosecutors did not stay well within the rules in the Moonlight
14
Fire litigation. See United States v. Maloney, 755 F.3d 1044, 1046 (9th Cir. 2014) (The
15
prosecutors job isnt just to win, but to win fairly, staying well within the rules.) (quotation
16
marks and citations omitted). Instead, they did whatever necessary, from allowing perjurious
17
testimony, to concealing critical facts, in an all-out effort to win. By engaging in this conduct, the
18
Moonlight Prosecutors forgot not only their obligations as attorneys, but also their obligation as
19
representatives of a sovereignty whose interest in a . . . prosecution is not that it shall win a case,
20
but that justice shall be done. Berger, 295 U.S. at 88. The Moonlight Prosecutors shielded by
21
the high level of trust our system of justice naturally places in them as representatives of the
22
United States pursued their goal at the expense of justice. Instead of serving as stewards of
23
69
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25
26
27
28
Of course, describing information which might help the defense as harmful to the United States, reveals a
fundamentally flawed mindset, something that animated this case throughout. As Overby told certain prosecutors
when he left them in disgust, we win if justice wins. If information is truthful, disclosing it to Defendants is most
decidedly not harmful to the United States, regardless of whether it aids Defendants. Since the Supreme Court
confirms that federal prosecutors are not in the business of winning but of furthering justice, disclosing the truth in
the context of litigation is always beneficial to the United States, even when doing so is helpful to the defense.
Moreover, while Wrights own discussion of the truth regarding what happened to him might be on some level
disloyal to his supervisor, Wright does not owe a duty of loyalty to his supervisor. He owes it to his client the United
States, and telling the truth about corruption is an act of loyalty towards his client. Indeed, in light of what is taught
through a variety of Supreme Court decisions, telling the truth as a prosecutor defines loyalty.
134
justice, they brought dishonor to their office by aiding and abetting the very type of conduct they
were charged with preventing, an approach which ultimately led to a fraud upon two courts.
Thus, the pervasive and coordinated misconduct of the Moonlight Fire Prosecutors,
whether viewed in isolated parts or as a whole, clearly and convincingly reflects an effort by the
government to prevent the judicial process from functioning in the usual manner, and that
involved perjury or nondisclosure [ ] so fundamental that it undermined the workings of the
adversary process itself. Stonehill, 660 F.3d at 445. The total effect of all this fraud . . . calls
for nothing less than a complete denial of relief. Hazel-Atlas, 322 U.S. at 250.
DOWNEY BRAND LLP
V. CONCLUSION
10
Those courts that have assessed whether litigation conduct has harmed the integrity of the
11
judicial system in a manner that warrants a finding of fraud on the court are frequently reviewing
12
facts associated with conduct by privately employed officers of the court who are dealing with
13
disputes between private entities. In those situations, where the conduct amounts to a scheme
14
which has done damage to our system of justice, the courts are not shy about following the
15
Supreme Courts direction in Hazel-Atlas and moving forcefully to protect and restore the
16
integrity of our legal system. The Moonlight Fire matter, however, presents a far more significant
17
attack on the integrity of our judicial system. Not only was the misconduct shockingly egregious
18
and pervasive, it was carried about by individuals sworn to protect the public and to preserve
19
justice by the law enforcement officers who conducted a sham investigation and by certain
20
Assistant United States Attorneys and Deputy Attorneys General who co-prosecuted this action in
21
a way that ultimately worked a colossal fraud on two courts. Those courts that have addressed
22
fraud on the court involving government actors, Shaffer, Demjanjuk, and Dixon, for instance,
23
have acknowledged a heightened level of sensitivity and concern when such conduct is carried
24
out by those who are sworn to protect justice. Judge Nichols did as well with respect to the
25
related state cases. If there was ever a case deserving of the full measure of this Courts powers
26
to protect the integrity of our legal system, it is the Moonlight Fire matter. Defendants
27
respectfully request that this Court restore justice by terminating this action and setting aside its
28
earlier settlement.
135
1
DATED: January 15, 2015
DOWNEY BRAND LLP
2
3
By:
/s/ William R. Warne

WILLIAM R. WARNE
Attorney for Defendant/Cross-Defendant
SIERRA PACIFIC INDUSTRIES
4
5
6
7
BRACEWELL & GIULIANI LLP
8
By:
/s/ Richard W. Beckler

RICHARD W. BECKLER
Attorney for Defendant/Cross-Defendant
SIERRA PACIFIC INDUSTRIES
10
11
MATHENY SEARS LINKERT & JAIME
DOWNEY BRAND LLP
12
By: /s/ Richard Linkert as authd on 1/15/15)
RICHARD LINKERT
Attorneys For Defendants W.M. BEATY &
ASSOCIATES, INC. AND ANN MCKEEVER
HATCH, as Trustee of the Hatch 1987 Revocable
Trust, et al.
13
14
15
16
RUSHFORD & BONOTTO, LLP
17
18
19
20
By: /s/ Phillip Bonotto (as authorized on 1/15/15)

PHILLIP BONOTTO
Attorneys for Defendant, EUNICE E. HOWELL,
INDIVIDUALLY and d/b/a HOWELLS
FOREST HARVESTING
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25
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27
28
136

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DOWNEY BRAND LLP

MATHENY SEARS LINKERT & JAIME, LLP

BRACEWELL & GIULIANI LLP

RUSHFORD & BONOTTO, LLP

Attorneys For Defendants W.M. BEATY &

Attorneys for Defendant, EUNICE E.

Case No. 2:09-CV-02445-WBS-AC

SIERRA PACIFIC INDUSTRIES, W.M.

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 2 of 144

WHAT DEFENDANTS MUST PROVE TO SEEK RELIEF UNDER RULE

Examples of Litigation Misconduct Which Have Been Held to Constitute

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 3 of 144

The Moonlight Prosecutors Advanced a Fraudulent Origin and

What Transpired on the Hillside on September 4-5, 2007 ........... 44

The Moonlight Prosecutors Affirmatively Assisted and

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 4 of 144

The Moonlight Prosecutors Made Reckless Misrepresentations

The Moonlight Prosecutors Misrepresentations to the Court

The Existence of WiFITER Constitutes a Fraud Upon the

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 5 of 144

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 6 of 144

In re Intermagnetics Am., Inc.,

Islamic Shura Council of S. Cal. v. F.B.I.,

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 7 of 144

United States v. Chu,

United States v. Estate of Stonehill,

United States v. Shaffer Equipment Company,

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 8 of 144

STATE RULES AND REGULATIONS

Cal. R. Prof. Conduct 7-107(C)................................................................................. 118, 120, 121

Cal. Rule Prof. Conduct 5-120(C) .............................................................................................. 36

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 9 of 144

the meaning of Rule 60(d)(3); and,

DOWNEY BRAND LLP

dismissal of the case.

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 10 of 144

DOWNEY BRAND LLP

rights, but have threatened the integrity of the judicial process.

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 11 of 144

separate order, Judge Nichols found:

In all matters, the Court maintains the ability to adjudicate the

DOWNEY BRAND LLP

awarded Defendants more than $30 million in discovery abuse sanctions.

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 12 of 144

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engaged in an unconscionable scheme by affirmatively advancing the Moonlight Investigators

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 13 of 144

improperly influencing this Court. Uncomfortable as it is to recognize such conduct in

for fraud at the other. Fed. R. Civ. P. 60.

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Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 14 of 144

Dixon, 316 F.3d at 1046 (quoting England, 281 F.2d at 309).

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 15 of 144

Examples of Litigation Misconduct Which Have Been Held to Constitute Fraud on

DOWNEY BRAND LLP

Hazel-Atlas Glass Company v. Hartford-Empire Company

patent infringement. Id. Hartford appealed. Id.

Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 16 of 144

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the Circuit Court of Appeals. 7 Id.

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Case 2:09-cv-02445-WBS-AC Document 625-1 Filed 01/21/15 Page 17 of 144